Fredrick Research, LLC. is
an independent agency that conducts research on consumer attitudes and
behaviors for a variety of firms. In one study, a client asked for an
investigation of consumer characteristics that can be used to predict the
amount charged by credit card users. Data were collected on annual income,
household size, and annual credit card charges for a sample of 52 customers. Use the data set attached to answer Questions.
- Write a one (1) page introduction on
credit card use in the US. Include what determines amount charged by users and
interest rates charged by card issuers to consumers. Make sure to include references (if
any at the end of your report). {} – 25 points. - Use
methods of descriptive statistics to summarize the data. Comment on the
findings.-20 points - Develop estimated regression
equations, first using annual income as the independent variable, and then
using the household size as the independent variable. Which variable is
the better predictor of annual credit card charges? Discuss your findings.
– 25 points - Develop
an estimated regression equation with annual income and household size as
the independent variables. Discuss
your findings. 15 points - What is the predicted annual
credit card charge for a three-person household with an annual income of
$39,000? – 5 points - Discuss the need for other
independent variables that could be added to the model. What additional variables might be
helpful? – 10 points
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