The following regression model was found for houses in an area of upstate New York: Price =

Question:

The following regression model was found for houses in an area of upstate New York:
Price = 20,986.09- 7483. 10 Bedrooms + 93.84 Living Area.
a) Find the predicted price of a 2 bedroom, 1000-sq-ft house from this model.
b) The house just sold for $135,000. Find the residual corresponding to this house.
c) What does that residual say about this transaction?