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Interest rates and mortgages Since 1985, average mortgage interest rates have fluctuated

Stats Modeling the World | 4th Edition | ISBN: 9780321854018 | Authors: David E. Bock, Paul F. Velleman, Richard D. De Veaux ISBN: 9780321854018 481

Solution for problem 36 Chapter 6

Stats Modeling the World | 4th Edition

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Stats Modeling the World | 4th Edition | ISBN: 9780321854018 | Authors: David E. Bock, Paul F. Velleman, Richard D. De Veaux

Stats Modeling the World | 4th Edition

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Problem 36

Interest rates and mortgages Since 1985, average mortgage interest rates have fluctuated from a low of under 6% to a high of over 14%. Is there a relationship between the amount of money people borrow and the interest rate thats offered? Here is a scatterplot of Mortgage Loan Amount in the United States (in thousands of dollars) versus Interest Rate at various times over the past 26 years. The correlation is -0.86. a) Describe the relationship between Mortgage Loan Amount and Interest Rate. b) If we standardized both variables, what would the correlation coefficient between the standardized variables be? c) If we were to measure Mortgage Loan Amount in hundreds of dollars instead of thousands of dollars, how would the correlation coefficient change? d) Suppose in another year, interest rates were 11% and mortgages totaled $250 thousand. How would including that year with these data affect the correlation coefficient? e) Do these data provide proof that if mortgage rates are lowered, people will take out larger mortgages? Explain

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Assignment # 2 STA 5205, 5126 and 4202 Date: Monday, October 5, 2015 This assignment is based on Chapters 3 and 4. You must show all necessary work to get full credit. Please submit your assignment in due time. Some selected questions will be graded. Pl keep 1” margin in all sides of the paper. You must define both null and alternative hypotheses for any test related question. You may use any computer software unless oherwise stated. First page is your cover page. First & Last Name:----------------------------------Panther ID:------------------------------------------- Problem #1: Four chemists are asked to determine the percentage of methyl alcohol in a certain chemical compound. Each chemist makes three determination

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Chapter 6, Problem 36 is Solved
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Textbook: Stats Modeling the World
Edition: 4
Author: David E. Bock, Paul F. Velleman, Richard D. De Veaux
ISBN: 9780321854018

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Interest rates and mortgages Since 1985, average mortgage interest rates have fluctuated