There are 2 parts to this question A&B. Please answer both A & B
B) What would it mean for the use of the FICO score as a tool for stores to rate consumers if there were no association between the category and default?
5.1.48 Question Help The best-known credit rating in one country is the FICO score. The score ranges from 300 to 850, with higher scores indicating that the consumer is a better credit risk. For the accompanying table, consumers with scores below 620 are labeled Risky. Those having scores between 620 and 660 are labeled Uncertain. Those between 660 and 720 have an Acceptable credit rating, and consumers with scores over 720 have Perfect credit. A department store kept track of loans (in the form of a store credit card) given to customers with various ratings. The accompanying table shows the proportion of customers within each risk category that did not repay the loan (defaulted). Complete parts (a) through (d) below. Click the icon to view the table. (a) Is the credit score (as defined these four categories) associated with default? How can you tell? Table of proportions for defaulting O A. Yes, because the percentages differ among the columns OB. No, because the percentages differ among the columns. OC. Yes, because the percentages are approximately the same among the columns. OD. Yes, bocause the percentages differ among the rows. O E. No, because the percentages are approximately the same among the columns. OF. No, because the percentages are approximately the same among the rows. Repaid Score Range Defaulted Risky 26% Uncertain 16% Acceptable 5% Perfect 74% 84%. 95% 96% Print Done Click to select your answer and then click Check Answer ? 5 parts remaining Clear All Check Answer 5.1.48 Question Help The best-known credit rating in one country is the FICO score. The score ranges from 300 to 850, with higher scores indicating that the consumer is a better credit risk. For the accompanying table, consumers with scores below 620 are labeled Risky. Those having scores between 620 and 660 are labeled Uncertain. Those between 660 and 720 have an Acceptable credit rating, and consumers with scores over 720 have Perfect credit. A department store kept track of loans (in the form of a store credit card) given to customers with various ratings. The accompanying table shows the proportion of customers within each risk category that did not repay the loan (defaulted). Complete parts (a) through (d) below. Click the icon to view the table. (a) Is the credit score (as defined these four categories) associated with default? How can you tell? Table of proportions for defaulting O A. Yes, because the percentages differ among the columns OB. No, because the percentages differ among the columns. OC. Yes, because the percentages are approximately the same among the columns. OD. Yes, bocause the percentages differ among the rows. O E. No, because the percentages are approximately the same among the columns. OF. No, because the percentages are approximately the same among the rows. Repaid Score Range Defaulted Risky 26% Uncertain 16% Acceptable 5% Perfect 74% 84%. 95% 96% Print Done Click to select your answer and then click Check Answer ? 5 parts remaining Clear All Check
