A Particular Bank Has Two Loan Modification Programs for Distressed

question 102

Multiple Choice

A particular bank has two loan modification programs for distressed borrowers: Home Affordable Modification Program (HAMP) modifications,where the federal government pays the bank $1,000 for each successful modification,and non-HAMP modifications,where the bank does not receive a bonus from the federal government.In order to qualify for a HAMP modification,borrowers must meet a set of financial suitability criteria.What type of hypothesis test should we use to test whether borrowers from this particular bank who receive HAMP modifications are more likely to re-default than those who receive non-HAMP modifications?

• A)A hypothesis test for
• B)A hypothesis test for
• C)A matched-pairs hypothesis test for the population means.
• D)A matched-pairs hypothesis test for the population proportions.

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Definitions:

Homo Erectus

"Upright human." A species within the genus Homo first appearing just after 2 million years ago in Africa and ultimately spreading throughout the Old World.

Oligocene Era

A geologic epoch of the Paleogene Period, occurring from about 34 to 23 million years ago, during which mammals and birds evolved considerably.

Continental Drift

In the theory of plate tectonics, the movement of continents embedded in underlying plates on the earth's surface in relation to one another over the history of life on earth.

Climate Change

Significant and long-term changes in the Earth's climate, including global warming, largely attributed to human activities.