HDI revisited The United Nations Development Programme (UNDP) uses the Human Development

Chapter 8, Problem 4

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HDI revisited The United Nations Development Programme (UNDP) uses the Human Development Index (HDI) in an attempt to summarize in one number the progress in health, education, and economics of a country. The number of phone subscribers per 100 people is positively associated with economic progress in a country. Can the number of phone subscribers be used to predict the HDI? Here is a scatterplot of HDI against phone subscribers: a) Explain why fitting a linear model to these data might be misleading. b) If you fit a linear model to the data, what do you think a scatterplot of residuals vs. predicted HDI will look like?

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