0. A finance company that lends to “high-risk†automobilebuyers, finds the following variables important in classifyingdefault probabilities: time at present residence, prior bankruptcyfiling (yes or no), time in present job, monthly income, phone inname (yes or no), prior repossession of item purchased on credit(yes or no), and type of residence (e.g., apartment, rent house,purchasing house). Listing each variable, suggest whether eachvariable increases (+) or decreases (−) anticipated default risk,and how you would evaluate the type of residence in assigningcreditworthiness to applicants
