Question
Describe the trend in the scatterplot of house price and area for some houses. State which point appears to be an outlier that does not fit the rest of the data.
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The scatter plot shows the relationship between the area of the house and the price of the house. Show more…
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Use a graphing utility to find the regression curves specified. The median price of single-family homes in the United States increased quite consistently during the years 1976-2000. Then a housing "bubble" occurred for the years $2001-2010,$ in which prices first rose dramatically for 6 years and then dropped in a steep "crash" over the next 4 years, causing considerable turmoil in the U.S. economy. The table shows some of the data as reported by the National Association of Realtors. $$\begin{array}{lc|cc}\hline \text { Year } & \text { Price (\$) } & \text { Year } & \text { Price (\$) } \\\hline 1976 & 37400 & 2000 & 122600 \\1980 & 56250 & 2002 & 150000 \\1984 & 66500 & 2004 & 187500 \\1988 & 87500 & 2006 & 247500 \\1992 & 95800 & 2008 & 183300 \\1996 & 104200 & 2010 & 162500 \\\hline\end{array}$$ a. Make a scatterplot of the data. b. Find and plot the regression line for the years $1976-2002$ and superimpose the line on the scatterplot in part (a). c. How would you interpret the meaning of a data point in the housing "bubble"?
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The correlation between house price (in dollars) and area of the house (in square feet) for some houses is 0.91. If you found the correlation between house price in thousands of dollars and area in square feet for the same houses, what would the correlation be?
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