Sum of the Years' Digits = \(\displaystyle{n}\frac{{{n}+{1}}}{{2}}={15}{\left({n}={5}\right)}\)
now the The forth year depreciation is 2/15 of $34,000.00= 4533.3333

Question

asked 2021-06-16

An office telephone system cost $32,000.00 with an estimated residual value of $2,000.00. The system has an estimated useful life of 5 years. Using the sum-of-the-years’-digits method, the amount of depreciation for the fourth year is

asked 2021-06-27

A $150,000 loan with $3000 in closing costs plus 1 point requires an advance payment of

asked 2021-08-12

A $150,000 loan with $3000 in closing costs plus 1 point requires an advance payment of

asked 2021-09-08

A bank finds that the estimated proportion of clients defaulting on a loan, given the interest rate is below \(\displaystyle{15}\%\), is 0.34, They also find that the estimated proportion of clients defaulting on a loan, given the interest is greater than or equal to \(\displaystyle{15}\%\), is 0.52.

a) What is the odds ratio of defaulting given the interest rate is greater than or equal to \(\displaystyle{15}\%\) relative to the interest rate is lower than \(\displaystyle{15}\%\)? Interpret this odds ratio.

b) If we were to analyze this data using the following logistic regression model, what are the estimates of \(\displaystyle\beta_{{{0}}}\) and \(\displaystyle\beta_{{{1}}}\)? Show your work.

\(\displaystyle{l}{g}{\left\lbrace{\left({\frac{{{p}}}{{{1}-{p}}}}\right)}\right\rbrace}=\beta_{{{0}}}+\beta_{{{1}}}{x}\)

Where p is the probability of defaulting on a loan and x is an indicator variable that is 1 when the interest rate is greater than or equal to \(\displaystyle{15}\%\) and 0 when the interest rate is less than \(\displaystyle{15}\%\).

a) What is the odds ratio of defaulting given the interest rate is greater than or equal to \(\displaystyle{15}\%\) relative to the interest rate is lower than \(\displaystyle{15}\%\)? Interpret this odds ratio.

b) If we were to analyze this data using the following logistic regression model, what are the estimates of \(\displaystyle\beta_{{{0}}}\) and \(\displaystyle\beta_{{{1}}}\)? Show your work.

\(\displaystyle{l}{g}{\left\lbrace{\left({\frac{{{p}}}{{{1}-{p}}}}\right)}\right\rbrace}=\beta_{{{0}}}+\beta_{{{1}}}{x}\)

Where p is the probability of defaulting on a loan and x is an indicator variable that is 1 when the interest rate is greater than or equal to \(\displaystyle{15}\%\) and 0 when the interest rate is less than \(\displaystyle{15}\%\).