An agent for a residential real estate company in a large city would like to be able to predict the monthly rental cost for apartments, based on the size of the apartment, as defined by square footage. A sample of 25 apartments (stored in the file rent.xls) in a particular residential neighborhood was selected, and the information gathered revealed the following:

a. Construct a scatter plot.

b. Use the least-squares method to find the regression coefficients b₀ and b₁.

c. Interpret the meaning of b₀ and b₁ in this problem.

d. Predict the mean monthly rent for an apartment that has 1,000 square feet.

e. Why would it not be appropriate to use the model to predict the monthly rent for apartments that have 500 square feet?

f. Your friends Jim and Jennifer are considering signing a lease for an apartment in this residential neighborhood. They are trying to decide between two apartments, one with 1,000 square feet for a monthly rent of $1,275 and the other with 1,200 square feet for a monthly rent of $1,425. What would you recommend to them based on (a) through (d)?