Question

The plot shown below describes the relationship between the average income in a city and the average rent for a 111-bedroom apartment in that city.
Which of the following is the best estimate of the average change in rent associated with a \$5\text{,}000$5,000dollar sign, 5, start text, comma, end text, 000 increase in income?
Choose 1 answer:

Answer 1

Answer:

The average change in rent can be determined by substituting the value of X as 5000 in the regression equation.

Step-by-step explanation:

A simple linear regression line is used to predict the value of the dependent variable from the independent variable.

The general form is:

$Y=\alpha +\beta X$

Dependent variables are those variables that are under study, i.e. they are being observed for any changes when the other variables in the model are changed.

The dependent variables are also known as response variables.

In this case the dependent variable is the average  change in rent for a 1-bedroom apartment.

Independent variables are the variables that are being altered to see a proportionate change in the dependent variable. In a regression model there can be one or more than one independent variables.

The independent variables are also known as the predictor variables.

In this case the independent variable is the average income in a city.

So, for an increase of $5,000 in incomes the average change in rent can be determined by substituting the value of X as 5000 in the regression equation.