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

question 38

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 0 if the customer has owned a home before and 1 if this is their first home. Identify and interpret the odds ratio estimate for Price of Home.

• A) Odds ratio: 4.56789; for each addition $10 spent on a home, the odds of a person defaulting increased 4.56%
• B) Odds ratio: 4.56789; for each addition $100 spent on a home, the odds of a person defaulting increased 4.56%
• C) Odds ratio: 4.56789; for each addition $10 spent on a home, a default is 4 times more likely
• D) Odds ratio: 4.56789; for each addition $1000 spent on a home, a default is 4 times less likely for each additional $1,000 spent

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Definitions:

Behavior Genetics Perspective

A field of study examining the role of genetic and environmental influences on behaviors and personality traits.

Hereditary Factors

Genetic elements and characteristics passed down from parents to offspring, influencing various traits and predispositions.

Environmental Factors

Refers to external influences that affect the growth, development, and survival of organisms, including climate, pollution, and urbanization.

Biopsychosocial Approach

An interdisciplinary model that examines the complex interplay between biological, psychological, and social factors in health and disease.