?Credit Scores An economist wants to determine the relation between one’s FICO score, x, and the interest rate of a 36-month auto loan, y. The data rep
Chapter 14, Problem 12(choose chapter or problem)
Credit Scores An economist wants to determine the relation between one’s FICO score, x, and the interest rate of a 36-month auto loan, y. The data represent the interest rate (in percent) a bank might offer on a 36-month auto loan for various FICO scores.
Use the results from Problem 18 in Section 4.2 to answer the following questions:
(a) Treating credit score as the explanatory variable, x, determine the estimates of 0 and
1.
(b) Compute the standard error of the estimate, Se.
(c) Determine Sb1.
(d) A normal probability plot of the residuals indicates it is reasonable to conclude the residuals are normally distributed. Test whether a linear relation exists between credit score and interest rate at the = 0.05 level of significance.
(e) Construct a 95% confidence interval about the slope of the true least-squares regression line.
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