Data from the U.S. Federal Reserve Board (Household Debt

Chapter 0, Problem 5.8

(choose chapter or problem)

Data from the U.S. Federal Reserve Board (Household Debt Service Burden, 2002) on the percentage of disposable personal income required to meet consumer loan payments and mortgage payments for selected years are shown in the following table: Consumer Household Consumer Household Debt Debt Debt Debt 7.88 6.22 6.24 5.73 7.91 6.14 6.09 5.95 7.65 5.95 6.32 6.09 7.61 5.83 6.97 6.28 7.48 5.83 7.38 6.08 7.49 5.85 7.52 5.79 7.37 5.81 7.84 5.81 6.57 5.79 a. What is the value of the correlation coefficient for this data set? b. Is it reasonable to conclude in this case that there is no strong relationship between the variables (linear or otherwise)? Use a graphical display to support your answer.

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