Question

Consider a dataset on house sales that is used to regress Y = selling price of home (in dollars) to X = size of house (in square feet). The prediction equation was yhat = -50926 + 126.6 x. Now we regard size of house as X1 and also consider X2 = whether the house is new (yes or no). The prediction equation relating yhat to x1 has slope 161 for new homes and 109 for older homes. Select all that apply.

1.) of a spurious association between selling price and size
2.) that size of house does not have a causal effect on price
3.) of a chain relationship, whereby whether new affects size which affects selling price
4.) of interaction between X1 and X2 in their effects of Y

Answer 1