Overview
Remove the 3 properties that only have a flat tax of $150 (these are the unimproved properties)
- Remove the exemptions from the tax. Use can use the following Excel equation: =IFS(E2=1,I2/(1-((E2+F2)*0.1)),E2=0,I2). If done correctly, the tax should be $1153.10 for the 1st house.
- Create a scatterplot of 1. RSF and Tax AND 2. ASF and Tax.
- Run a regression model between 1. RSF and Tax AND 2. ASF and Tax.
- Perform a 2-sided, paired t-test to evaluate whether mean RSF=mean ASF. Why is performing this t-test important? Why should it be a 2-sided test? Use the Excel equation T.TEST to generate a p-value: =T.TEST(G2:G78,H2:H78,2,1)
- Decide whether you will use RSF or ASF as your predictor variable (independent variable) and come prepared to justify your answer [Hint: Use the case background and your answer to task 6 above to justify your answer).
- Consider how you can show that this new model does not increase the tax burden on each citizen and is also revenue neutral for the city. Why does that matter?
- Have a great week. Office hours will be Saturday 9am EST. I will update later in the week if I can add a session on Thursday/Friday.