The National Association of Realtors maintains a database consisting of sales information on homes sold in the United States. In order to investigate the sales prices for single-family homes, a multiplier linear regression model is estimated using data on a sample of 28 recently sold, single-family homes. The dependent variable is the sales price (in $1000). Data on the region of the country in which the home is located and the total number of homes sold in the region during the month the home sold are collected and to be used as the independent variables. In order to include the region of the country in the model, the following dummy variables are created

X1=1 if the region is NW; O otherwise

X2=1 if the region is S; O otherwise

X3=1 if the region is W; 0 otherwise

The default category for the dummy variables is NE.

The regression results are shown below

SUMMARY OUTPUT Regression Statistics Multiple R 0.89 R Square 0.80 Adjusted R Square 0.78 Standard Error 4.72 Observations 28 ANOVA Significance df SS MS F F Regression 4 19176.33 4794.082 2.508483 0.069883 Residual 23 43956.4 1911.148 Total 27 63132.73 Standard Coefficients Error t Stat P-value Intercept 144.91 62.55 2.32 0.03 Volume 1.51 0.63 2.40 0.03 X1 -87.35 29.31 -2.98 0.01 X2 -172.09 67.43 -2.55 0.02 X3 -54.49 29.06 -1.88 0.07