Possible model for house prices

After showing the distribution of Y at each x as a histogram on the previous page, this page presents a possible model for the data to be normal distributions for each x.

Again, drag the centre of the diagram to rotate it.

By rotating the diagram to superimpose the normal pdfs, you can also discuss linearity and constant variance implied by this model.

Click Take sample to show random samples from this model.

The model claims that the observed data (previous page) are a sample of this form.


The sale prices of all houses sold in an area were collected. How does the sale price relate to the number of bathrooms in the houses? (The data are not real.)