1.Airline data from the US Bureau of Transportation Statistics have been

compiled by an insurance company for three different airlines between the periods

of December 2002 to January 2003.

Delta

Spirit

American

Total

On Time

320

710

470

1500

Late

100

180

120

400

Total

420

890

590

1900

a)

Which airline arrives on time

relatively

more often?

Explain your

logic

and

show

all

work.

b)

Calculate the rate that each airline is Late as a function of total late

flights. Show all work.

c)

What lurking variables might be present that the insurance company

has not accounted for?

d)

The insurance company wants to insure against late

flights but

needs

to know what prices to charge for each different airline. How can their

research team find better measures to differentiate prices along these three

airlines?

-

3 sentences)