Question
provide the R code, the R output and your comments on the output. Comment each line of your R code as well For this exercise,
provide the R code, the R output and your comments on the output. Comment each line of your R code as well
For this exercise, the only extra package allowed is ISLR2. Consider the dataset Default in the package ISLR2. We are interested in predicting the output variable default given all other variables in the dataset as inputs using the linear probability model. Compute the training error rate (over the whole sample) of the linear probability model and compare it with the training error rate of logistic regression using the same output and input variables. Discuss the performance of the linear probability model in this dataset, in particular when compared with logistic regression. (Hint) The linear probability model is a linear regression model that is fitted using least squares. Note that default is a factor variable and may need to be transformed into a numeric variable as the function lm expects the output variable to be numeric. The function as.numeric could be used for that purpose.
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