Question
On a peer-to-peer (P2P) lending website, borrowers complete an approval scoring form that lenders use to assess creditworthiness. Borrowers are rated A, B, C or
On a peer-to-peer (P2P) lending website, borrowers complete an approval scoring form that lenders use to assess creditworthiness. Borrowers are rated A, B, C or D, based on their scores, with A having the highest scores and D having the lowest. In a large sample of borrowers, 26% were rated A, 22% were rated B, 35% were rated C, and the rest were rated D. Suppose the scores are normally distributed with a mean of 302 and a standard deviation of 50. Round numeric answers to the nearest integer. a) What is the cut-off score between A and B? b) What is the cut-off score between B and C? c) What is the cut-off score between C and D? d) What score corresponds to the 85th percentile? e) What score corresponds to the 40th percentile? f) What is the minimum score above which lies 18% of the scores? g) Between what scores will the middle 56% of scores lie? Lower value = Higher value = h) What rating will a score of 235 receive? Select an answer D-rating C-rating B-rating A-rating i) What rating will a score of 301 receive? Select an answer D-rating C-rating B-rating A-rating
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