Below Gives the Data Concerning (1) the Dependent Variable Default

question 88

Multiple Choice

Below gives the data concerning (1) the dependent variable Default which equals 1 if a customer defaults on their loan and 0 if they do not; (2) the independent variable Price of Home, which is the price of the home (in tens) and (3) the independent variable First Purchase which equals 1 if the customer has owned a home before and 0 if this is their first home. Estimate the probability that a buyer who spent $535,600 on their fourth home purchase will default.

• A) .5842
• B) .5674
• C) .9834
• D) .9465

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Definitions:

Sales Taxes Payable

The liability account used to record the sales tax collected from customers by a seller, which is due to be paid to the government.

Cash Sales

Transactions in which goods or services are paid for and received at the time of the sale, using cash or equivalent.

Sales Taxes

Taxes imposed by governments on the sale of goods and services.

Journal Entry

A record in accounting that notes transactions and changes in financial statements.