ts website the Statesman Journal newspaper (Salem Oregon, 2005) reports mortgage

Question

ts website the Statesman Journal newspaper (Salem Oregon, 2005) reports mortgage loan interest rates for 30-year and 15-year foxed-rate mortgage loans for a number of Willamete Valley ending instihutions Of interest is whether there is any systematic difference between 30-year rates and 15-year rates (expressed as annual percentage rate or APR) and, if there is, what is the size of rat dference The following table displays the 30-year rate and the 15-year rate for each of nine lending institutions Also given is the difference between the 30-year rate and the 15-year zate for each ending insttution Use the table to compare the 30-year rates and the 15-year rates. Also, calculate the average of the differences between the rates (Input the amount as positive value. Round your answer to 4 decimal places ) e Rabon Home Mortgage Coast To Coast Mongage 2503 5 656 3 153 405 5600 51% 40954 562 35726175 4 905 5 427 5256 4231 4745 2 603 volusiona Vialey Morgage 6300 4441 395 636 Resident Lending Group n 514

Explanation / Answer

overall the 30 year rates are less than the 15 year rates

the variability is larger

averageof the differences =-0.4136

30-year 15-year difference 2.503 5.656 -3.153 5.6 5.195 0.405 4.895 4.562 0.333 3.572 6.175 -2.603 5.73 3.85 1.88 5.3 4.905 0.395 4.681 5.317 -0.636 5.427 5.256 0.171 4.231 4.745 -0.514 mean 4.66 5.07 -0.41 std deviation 1.07 0.67 1.57

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