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  3. question 6 1 mark one of the conditions required for...

Question: question 6 1 mark one of the conditions required for...

Question details

Case Study

Life insurance companies are interested in predicting how long their customers will live because

their premiums and protability depend on these numbers. An actuary for one insurance company

gathered data from 100 recently deceased male customers. He recorded the age at death of the

customer plus the ages at death of his mother and father, the mean ages at death of his grandmothers

and the mean age

The actuary would like to determine whether the age at death of a customer's mother is useful

in predicting the life expectancy (age at death) of the customer. Use Excel to generate the following

output for the variables age at death of a customer's mother and life expectancy (age at death) of

the customer.

 

Question 6 (1 mark)

One of the conditions required for the regression analysis to be valid is that the error variable is

normally distributed. For our analysis we conclude that

 

The condition is

 

a) satisfied 

b) not satisfied 

 

because the

 

a) histogram of residuals

b) residual plot 

 

and 

 

a) has an approximate bell shape

b) appears to be skewed 

c) shows no apparent change in the variation of the residuals 

d) shows a decrease in the residuals for larger values of x 

e) shows a increase in the residuals for larger values of x 

 

Question 7 (1 mark)

The residual for the 17 th observation correct to 3 dp is

 

 

Question 8 (1 mark)

The coecient of determination expressed as a decimal correct to 3dp is

 

Question 9 (1 mark)

Use the regression equation from your analysis to predict the life expectancy (age at death) to the

nearest year of a customer whose age at death of a customer's mother was 70.

 

 

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