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Use the housing price data in HPRICE1.RAW for this exercise.
(i) Estimate the model
log(price) = (0 + (1 log(lotsize) + (2 log(sqrft) + (3 bdrms + u
and report the result in the usual OLS format.
(ii) Find the predicated value of log(price), when lotsize = 20,000, sqrft = 2,500, and bdrms = 4. Using the methods in Section 6.4, find the predicated value of price at the same values of the explanatory variables.
(iii) For explaining variation in price, decide whether you prefer the model from part (i) or the model
price = (0 + ((1 lotsize + (2 sqrft + (3 bdrms + u. |
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