A particular has two loan modification programs tot distressed borrows: Home Aff

Question

A particular has two loan modification programs tot distressed borrows: Home Affordable Modification Program (HAMP) modifications, where the federal government pays the bank $1,000 for each successful modification, and non HAMP modifications, where the bank does not receive a bonus from the federal government. In order to qualify for a HAMP modification, borrowers must meet a set & Sandal suitability criteria. What type at hypothesis test should use to test whether borrows from this particular bank who receive HAMP modifications are more likely to re-default than those who receive non-HAMP modifications?

Explanation / Answer

a matched paired test

is matched paired test because we have two samples that if you use independent test you will have more error because the effect of the banks is a noise in the experiment

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