Module 04 - Case Assignment

Housing Starts

For this case read the short article below concerning interest rates.

Ramat-Gan (Jun 30, 2003) INTEREST RATE PLUNGE WILL CONTINUE Info - Prod Research ( Middle East ).

Then I would like you to compute a simple regression formula using the interest rates and number of housing starts provided below.   Once you have computed your regression formula answer the following questions.

1. What is the regression formula that you computed?
2. What would the approximate number of housing starts be at the following interest rates:  8.5%, 4.5%, 3.7%, 2.3%?
3. If you were the owner of a business in the housing construction sector and you knew interest rates were going to change; how could you use this information to make better decisons?

Housing Starts in Relation to Interest Rates

Interest Rate            Housing Starts

11%                            9,000

10%                          10,000

9%                            24,000

8%                            40,000

7%                            52,000

6%                            65,000

5%                            80,000

4%                          100,000

3%                          130,000

2%                          135,000

Click HERE to compute regression formula.  (Use the simple regression equation y = mx + b.  NOTE: Enter percentages as .02, .03, .04, etc.)

Write a 3-4 page paper answering the above question.  Please turn this in to me by the end of this module.

Price: $8.0

Solution: The downloadable solution consists of 4 pages, 400 words and 1 charts.
Deliverable: Word Document