Basic Business Statistics, Student Value Edition (13th Edition)
13th Edition
ISBN: 9780321946393
Author: Mark L. Berenson, David M. Levine, Kathryn A. Szabat
Publisher: PEARSON
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Chapter 8, Problem 64PS
Claims fraud (illegitimate claims) and buildup (exaggerated loss amounts) continue to be issue of concern among automobile insurance companies. Fraud is defined as specific material misrepresentation of the facts of a loss; buildup is defined as the inflation of an otherwise legitimate claim. A recent study examined auto injury claims closed with payment under private passenger coverages. Detailed data on injury, medical treatment, claimed losses, and total payments, as well as claim-handing techniques, were collected. In addition , auditors were asked to review the claim files to indicate whether specific elements of fraud of buildup appeared in the claim and, in the case of buildup to specify the amount of excess payment. The file InsuranceClaims contains data for 90 randomly selected auto injury claims. The following variables are included: CLAIM–Claim ID; BUILDUP–1 if buildup indicated, 0 if not; and EXCESSPAYMENT –excess payment amount, in dollars.
a. Construct a
b. Construct a
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2. Which of the following is not considered a personal risk?
a. Insufficient income during retirement
b. Unemployment
c. Financial risk
d. Premature death
4. A liability insurance policy has a deductible of $100,000, a policy limit of$20,000,000 and co-insurance such that the policyholder pays 20% of theremaining claim. How much does the insurer pay if the loss is:
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The Bank of Canada is interested in studying the relationship between mortgage rates and median
home prices. The data is provided below
Median home price
$183,800
$183,200
$174,900
$173,500
$172,900
$173,200
$173,200
$169,700
$174,500
$177,900
Year
interest rate (%)
10.30
1988
1989
10.30
1990
10.10
1991
9.30
1992
8.40
1993
7.30
1994
8.40
1995
7.90
1996
7.60
1997
7.60
$188,100
$203,200
$230,200
$258,200
1998
6.90
1999
7.40
2000
8.10
2001
7.00
$309,800
$329,800
$431.000
2002
6.50
2003
5.80
2004
5.80
$515,000
$537,000
2005
5.80
2006
6.40
2007
6.30
$496,000
$352,000
$232,000
$291.700
$262,900
2008
6.00
2009
5.00
2010
4.70
2011
4.40
$299,200
$321,200
$373,500
$358,100
$382,500
$402,900
2012
3.60
2013
4.00
2014
4.10
2015
3.80
2016
3.60
2017
4.00
a) Estimate a simple linear regression model and find the value of the parameters for the
estimation of morteaze rates and the median home price.
b) Interpret the intercept and the slope coefficient:
c) State the comelation coefficient and the…
Chapter 8 Solutions
Basic Business Statistics, Student Value Edition (13th Edition)
Ch. 8 - If X=85, =8,andn=64, construct a 95 confidence...Ch. 8 - If X=125,=24,andn=36, construct a 99 confidence...Ch. 8 - Why is it not possible in Example 8.1 on page 280...Ch. 8 - Is it true in Example 8.1 on page 277 that you do...Ch. 8 - A market researcher selects a simple random sample...Ch. 8 - Suppose that you are going to collect a set of...Ch. 8 - Consider the confidence interval estimate...Ch. 8 - You are working as an assistant to the dean of...Ch. 8 - A bottled water distributor wants to estimate the...Ch. 8 - The operations manager at a compact fluorescent...
Ch. 8 - If X=75,S=24,andn=36, and assuming that the...Ch. 8 - Determine the critical value of t in each of the...Ch. 8 - Assuming that the populations is normally...Ch. 8 - Assuming that the population is normally...Ch. 8 - A marketing researcher wants to estimate the mean...Ch. 8 - A survey of nonpro�t organizations showed that...Ch. 8 - The U.S. Department of Transportation requires...Ch. 8 - Prob. 18PSCh. 8 - The �le Sedans contains the overall miles per...Ch. 8 - The file SUV contains the overall MPG of 2013...Ch. 8 - Is there a difference in the yields of different...Ch. 8 - One of the major measures of the quality of...Ch. 8 - A manufacturing company produces electric...Ch. 8 - Prob. 24PSCh. 8 - One operation of a mill is cut pieces of steel...Ch. 8 - Ifn=200andX=50, Construct a 95 confidence interval...Ch. 8 - ifn=400andX=25, Construct a 99 confidence interval...Ch. 8 - A cellphone provider has the business objective of...Ch. 8 - In a survey of 3,773 travelers, 1,509 said that...Ch. 8 - Prob. 30PSCh. 8 - Prob. 31PSCh. 8 - Prob. 32PSCh. 8 - What are the factors that influence technology...Ch. 8 - If you want to be 95 confident of estimating the...Ch. 8 - If you want to be 99 confident of estimating of...Ch. 8 - If you want to be 99 confident of estimating the...Ch. 8 - If you want to be 95 confident of estimating the...Ch. 8 - A survey is planned to determine the mean annual...Ch. 8 - If the manager of a bottled water distributor...Ch. 8 - Prob. 40PSCh. 8 - If the inspection division of a county weights and...Ch. 8 - Prob. 42PSCh. 8 - Prob. 43PSCh. 8 - A growing niche in the restaurant business is...Ch. 8 - What advertising medium is most influential in...Ch. 8 - A survey of 300 U.S. online shoppers was...Ch. 8 - Prob. 47PSCh. 8 - According to a new study released by Infosys. a...Ch. 8 - Prob. 49PSCh. 8 - Why can you never really have 100 confidence of...Ch. 8 - When should you use the t distribution to develop...Ch. 8 - Why is it true that for a given sample size, n an...Ch. 8 - Why is the sample size needed to determine the...Ch. 8 - The Pew Internet Project survey of 2,253 American...Ch. 8 - Prob. 55PSCh. 8 - A market researcher for a consumer electronics...Ch. 8 - Prob. 57PSCh. 8 - Prob. 58PSCh. 8 - A national association devoted to human resource...Ch. 8 - The financial impact of IT system downtime is a...Ch. 8 - The branch manager of an outlet (Store 1) of a...Ch. 8 - Scarlett and Heather, the owners of an upscale...Ch. 8 - The manufacturer of Ice Melt claims that its...Ch. 8 - Claims fraud (illegitimate claims) and buildup...Ch. 8 - A quality characteristic of interest for a...Ch. 8 - Prob. 66PSCh. 8 - The manufacturer of Boston and Vermont asphalt...Ch. 8 - The manufacturer of Boston and Vermont asphalt...Ch. 8 - Referring to the results in Problem 8.66...
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- The Bank of Canada is interested in studying the relationship between mortgage rates and median home prices. The data is provided below Median home price $183,800 $183,200 $174,900 $173,500 $172,900 $173,200 $173,200 $169,700 $174,500 $177,900 Year interest rate (%) 10.30 1988 1989 10.30 1990 10.10 1991 9.30 1992 8.40 1993 7.30 1994 8.40 1995 7.90 1996 7.60 1997 7.60 $188,100 $203,200 $230,200 $258,200 1998 6.90 1999 7.40 2000 8.10 2001 7.00 $309,800 $329,800 $431.000 2002 6.50 2003 5.80 2004 5.80 $515,000 $537,000 2005 5.80 2006 6.40 2007 6.30 $496,000 $352,000 $232,000 $291.700 $262,900 2008 6.00 2009 5.00 2010 4.70 2011 4.40 $299,200 $321,200 $373,500 $358,100 $382,500 $402,900 2012 3.60 2013 4.00 2014 4.10 2015 3.80 2016 3.60 2017 4.00 d) Confirm the intercept, slope and correlation coefficient by computing them without SPSS e) At the 5% significance level, determine if the model is useful. In responding, construct and test any appropriate hypothesis.arrow_forwardThe Bank of Canada is interested in studying the relationship between mortgage rates and median home prices. The data is provided below interest rate (%) 10.30 Year Median home price S183,800 $183,200 1988 1989 10.30 1990 10.10 $174,900 1991 9.30 S173,500 $172,900 $173,200 1992 8.40 1993 7.30 1994 8.40 $173,200 S169,700 S174,500 1995 7.90 1996 7.60 1997 7.60 $177,900 $188,100 S203,200 $230,200 $258,200 S309,800 1998 6.90 1999 7.40 2000 8.10 2001 7.00 2002 6.50 2003 5.80 $329,800 2004 5.80 $431,000 2005 2006 2007 $515,000 $537,000 $496,000 5.80 6.40 6.30 2008 6.00 $352,000 $232,000 $291,700 $262,900 2009 5.00 2010 4.70 2011 4.40 2012 2013 3.60 $299,200 4.00 $321,200 $373,500 $358,100 $382,500 $402,900 2014 4.10 2015 3.80 2016 3.60 2017 4.00 a) Estimate a simple linear regression model and find the value of the parameters for the estimation of mortgage rates and the median home price. b) Interpret the intercept and the slope coefficients c) State the correlation coefficient and the…arrow_forwardThe Bank of Canada is interested in studying the relationship between mortgage rates and median home prices. The data is provided below Year interest rate (%) Median home price S183,800 $183,200 1988 10.30 1989 10.30 1990 10.10 S174,900 1991 9.30 S173,500 1992 8.40 $172,900 1993 7.30 $173,200 1994 8.40 $173,200 S169,700 S174,500 Ineed 1995 7.90 1996 7.60 help with 1997 7.60 $177,900 1998 6.90 $188,100 1999 $203,200 $230,200 7.40 2000 8.10 parts 2001 7.00 $258,200 2002 2003 S309,800 $329,800 6.50 5.80 2004 5.80 $431,000 () $515,000 $537,000 $496,000 2005 5.80 2006 6.40 2007 6.30 2008 6.00 $352,000 2009 5.00 $232,000 2010 $291,700 $262,900 $299,200 4.70 2011 4.40 2012 2013 3.60 4.00 $321,200 $373,500 $358,100 $382,500 $402,900 2014 4.10 2015 2016 3.80 3.60 4.00 2017 a) Estimate a simple linear regression model and find the value of the parameters for the estimation of mortgage rates and the median home price. b) Interpret the intercept and the slope coefficients c) State the correlation…arrow_forward
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