Consider a dataset with three observations (Y1, Y2, Y3) and (X1, X2, X3) where t

Question

Consider a dataset with three observations (Y1, Y2, Y3) and (X1, X2, X3) where the Y's are binary outcomes. Write the likelihood function of logit model where Z = beta0 + beta 1X + beta X2. Write the likelihood for the probit model as well. Write the expression for the change in the probability that Pr (Y = 1|X) for a unit change in X under the linear probability model Y = beta0 + beta1 X + beta X2 Write the expression for the change in the probability that Pr (Y = l|X)for a unit change in X under the logit model for Z. Write the log-likelihood for the logit model. Write first order conditions of the log-likelihood of the MLE logit estimator for (beta 0, beta 1, beta2). This question deals with the dataset of American Express credit card applicants AmEx.dta. For each part, you will need to report results for the linear probability model, logit, and probit models. The best way to organize your results is in the form of a table. Report the log-likelihood and pseudo R2 for the nonlinear models and the R2 and adjusted R2 for the linear model cardhldr a binary indicator for whether or not the individual is approved as cardholder income the applicants income

Explanation / Answer

Applying for an American Express credit card is easy and you can be approved quickly whether you apply through mail, online or over the phone. Before you sign up for an American Express credit card, make sure you choose the right card and understand any rewards, terms and fees that the card carries with it. EditSteps 1Determine which kind of credit card best suits your needs. If you want rewards, decide which type you prefer; you can find cards that offer cash, airline tickets and hotel stays. Alternatively, it may be more important for you to have a business card. 2Compare card benefits at AmericanExpress.com. 3Review each card's terms, conditions and any associated fees. It's important to read this fine print so that you're not surprised later on. 4Respond to a credit card offer you received in the mail by mailing back the application form or by clicking on "Respond to a Mail Offer" at AmericanExpress.com If you have your offer in hand, there should be an RSVP code that you will need to access the offer online, as well as your zip code. If you don't have the offer in hand, you can enter some personal information, such as your address and name, to access the mailed offer. 5Apply online by filling out a form with your personal information, employer information and housing status if you rent or own. You may also have to submit your annual household income. Approval can take as little as one minute. 6Apply by phone by calling 1-800-223-2670. Phone lines are open 24 hours a day, seven days a week. 7Check the status of your application online if it isn't subject to almost immediate approval. 8Wait for your card to arrive. New cards should arrive within a week to 10 days. Look for a white envelope with an American Express logo and an Omaha, Nebraska return label. If 10 days have passed with no card, contact American Express customer service. 9Activate your American Express credit card by following the directions you receive with the new card in the mail. 10Manage your account by enrolling your card at AmericanExpress.com to obtain an online account. This way, you can pay your bill and monitor your card information by simply logging in. 11Use your new American Express credit card to its full advantage. Educate yourself on the rewards and make sure you redeem points properly, at the right times, to maximize your rewards before your points expire. Access insurance on your purchases--at no additional cost to you--and familiarize yourself with American Express's extended warranty offers. Utilize the travel protection and assistance that comes with your American Express credit card. Amex tends to base their approvals/denials on peoples credit reports more than solely on credit scores. Also, much depends on which card you apply for. Even though they tend to base things more on credit report over scores, I've seen people get approved with FICO scores in the low 600's - again dependent on the card that was applied for. If you have recent major/minor negatives, within the past two years, it may be difficult to be approved. If you have older negatives, but not many, then you "may" be approved. If you have older negatives or you are just starting to build a credit file and you want to apply, you might apply for the Delta Gold. The annual fee on that card is waived for the first year, it is also one of the easier cards for those with negatives, or just starting to build, to get approved for. Keep it in good standing for 4-6 months then call them and ask if you can convert the card to one that you would rather have. (they do convert the cards so if you get a CSR that says it's not possible, say thank you, hang up and try with a different one) 5 years ago

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