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##### COMM 291 ASSIGNMENT 6 Two Questions

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Question;Question;1 ? Office Rents;An economist;wanted to investigate the relationship between office rents and vacancy rates.;He took a random sample of monthly office rents (Rent), the percentage of vacant office space (Vacancy)and the city?s unemployment rate (Unemployment) in 30 different cities. The data are in the worksheet;OfficeRents in;the Excel spreadsheet.;a) Fit a;regression model to predict Rent from;Vacancy and Unemployment.a) Compute;and interpret the value of R-squared.a) What;would your conclusion be if you test the hypothesis that the coefficients for Vacancy and Unemploymentare both zero? Explain in one sentence. Include the;test-statistic, the degrees of freedom and the P-value in your answer.a) What;would your conclusion be from a hypothesis test for the coefficient for Vacancy? Explain in one sentence. Include;the corresponding test-statistic, degrees of freedom and P-value in your;answer.a) Examine;the distribution of the residuals and plot the residuals versus each of the;explanatory variables. Describe your findings. Does your analysis suggest that;the model assumptions may not be reasonable for this problem? Explain.f) Fit a;regression model to predict Rent;using only Vacancy. Explain why the;coefficient for years in rank and the results of a significance test for this;coefficient differ from what you found in parts (a) and (d) above.g) Give an approximate;95% prediction interval for the office rent in a city whose vacancy rate is 10%;and whose unemployment rate is 7%.="msonormal">Question 2 ? Simple;Linear Regression MS Excel Template;Below is the;template for the output from simple regression using MS Excel. But instead of;actual results, the cells are numbered from (1) to (27). Your task is to;provide the formulas used to compute each of the cell entries. You can answer;this in neat handwritten form, you do not need to type the formulas! Just write;each cell number and the corresponding formula after it.;Some of these;statistics can be obtained by more than one formula. Any correct formula is;acceptable. Some of these are most easily obtained from other cells in the;table. If so, use "Cell X" as part of your formula.;Note: This will;be excellent practice for the final exam. We suggest that you keep a copy of;your answers to this question as a formula sheet for the exam.;SUMMARY OUTPUT;Regression Statistics;Multiple R;(1);R Square;(2);Adjusted R Square;(3);Standard Error;(4);Observations;(5);ANOVA;df;SS;MS;F;Significance F;Regression;(6);(7);(8);(9);(10);Residual;(11);(12);(13);Total;(14);(15);Coefficients;Standard Error;t Stat;P-value;Lower 95%;Upper 95%;Intercept;(16);(17);(18);(19);(20);(21);X Variable;(22);(23);(24);(25);(26);(27);="msonormal">="msonormal">="msonormal">="msonormal">="msonormal">="msonormal">

Paper#60460 | Written in 18-Jul-2015

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