Purpose

This assignment provides an opportunity to develop, evaluate, and apply bivariate and multivariate linear regression models.

Resources:Microsoft Excel, DAT565_v3_Wk5_Data_File

Instructions:

The Excel file for this assignment contains a database with information about the tax assessment value assigned to medical office buildings in a city. The following is a list of the variables in the database:

• FloorArea: square feet of floor space
• Offices: number of offices in the building
• Entrances: number of customer entrances
• Age: age of the building (years)
• AssessedValue: tax assessment value (thousands of dollars)

Use the data to construct a model that predicts the tax assessment value assigned to medical office buildings with specific characteristics.

• Construct a scatter plot in Excel with FloorArea as the independent variable and AssessmentValue as the dependent variable. Insert the bivariate linear regression equation and r^2 in your graph. Do you observe a linear relationship between the 2 variables?
• Use Excel's Analysis ToolPak to conduct a regression analysis of FloorArea and AssessmentValue. Is FloorArea a significant predictor of AssessmentValue?
• Construct a scatter plot in Excel with Age as the independent variable and AssessmentValue as the dependent variable. Insert the bivariate linear regression equation and r^2 in your graph. Do you observe a linear relationship between the 2 variables?
• Use Excel's Analysis ToolPak to conduct a regression analysis of Age and Assessment Value. Is Age a significant predictor of AssessmentValue?

Construct a multiple regression model.

• Use Excel's Analysis ToolPak to conduct a regression analysis with AssessmentValue as the dependent variable and FloorArea, Offices, Entrances, and Age as independent variables. What is the overall fit r^2? What is the adjusted r^2?
• Which predictors are considered significant if we work with =0.05? Which predictors can be eliminated?
• What is the final model if we only use FloorArea and Offices as predictors?
• Suppose our final model is:
• AssessedValue = 115.9 + 0.26 x FloorArea + 78.34 x Offices
• What wouldbe the assessed value of a medical office building with a floor area of 3500 sq. ft., 2 offices, that was built 15 years ago? Is this assessed value consistent with what appears in the database?

Submityour assignment.

FloorArea (Sq.Ft.)

Offices

Entrances

Age

AssessedValue ($'000)

4790

4

2

8

1796

4720

3

2

12

1544

5940

4

2

2

2094

5720

4

2

34

1968

3660

3

2

38

1567

5000

4

2

31

1878

2990

2

1

19

949

2610

2

1

48

910

5650

4

2

42

1774

3570

2

1

4

1187

2930

3

2

15

1113

1280

2

1

31

671

4880

3

2

42

1678

1620

1

2

35

710

1820

2

1

17

678

4530

2

2

5

1585

2570

2

1

13

842

4690

2

2

45

1539

1280

1

1

45

433

4100

3

1

27

1268

3530

2

2

41

1251

3660

2

2

33

1094

1110

1

2

50

638

2670

2

2

39

999

1100

1

1

20

653

5810

4

3

17

1914

2560

2

2

24

772

2340

3

1

5

890

3690

2

2

15

1282

3580

3

2

27

1264

3610

2

1

8

1162

3960

3

2

17

1447