Briefly describe the three key points managers must consider when using expert opinion, consumer surveys, test marketing, and price experiments in analyzing consumer behavior.
57) What are the effects of two independent variables that are highly correlated? What can be done to remedy the problem?
Scenario 2: Below is a multiple regression in which the dependent variable is market value of houses and the independent variables are the age of the house and square footage of the house. The regression was estimated for 42 houses.
Adjusted R Square0.532981
Regression2 25376501711.27E+09 24.39544 1.3443E-07
Total 41 4566069762
Coefficients Standard t Stat P-value Lower 95% Upper 95%
Intercept 47331.38 13884.34664 3.408974 0.001528 19247.6673 75415.0958
House Age -825.161 607.3128421 -1.35871 0.182046 -2053.5662 403.243744
Square Feet 40.91107 6.696523994 6.109299 3.65E-07 27.3660835 54.4560534
58) Refer to Scenario 2. What is the estimated regression equation for determining the market value of houses?
59) Refer to Scenario 2. If the age of a house is 25 years with 1,500 square feet, what is the estimated market value of the house?
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