An economist wants to determine the relation between one’s FICO score, ?, and the interest rate (in percent) of a 36-month auto loan, ?. Credit score,x Interest Rate(percent), y 545 18.982 595 17.976 640 12.218 675 8.612 705 6.680 750 5.150 (a) What is the best fit line that could be used to predict the interest rate? (b) Interpret the slope and vertical intercept. (c) How would you determine if your best fit line is a good fit for this data? Explain using at least two methods
An economist wants to determine the relation between one’s FICO score, ?, and the interest rate (in percent) of a 36-month auto loan, ?.
Credit score,x Interest Rate(percent), y
545 18.982
595 17.976
640 12.218
675 8.612
705 6.680
750 5.150
(a) What is the best fit line that could be used to predict the interest rate?
(b) Interpret the slope and vertical intercept.
(c) How would you determine if your best fit line is a good fit for this data? Explain using at least two methods
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