CAS Exam MAS-I Spring 2019, Question 33
Study guide: Exam MAS-I
You are given the following information regarding a GLM that was used to predict claim severity of Homeowners insurance losses:
- The available predictors are:
- Number of Stories of home ("1" or "2+")
- Square Footage of the home ("Under 1500", "1501 to 2500", or "Over 2500")
- The partial ANOVA results, which are available to evaluate whether the interaction term "Number of Stories x Square Footage" is predictive, are given below:
| Response variable | Insured Loss |
| Response distribution | Normal |
| Link | Identity |
| Parameters | Degrees of freedom | Sum of squares |
|---|---|---|
| Number of Stories, Square Footage, and intercept | 4 | 1,128.19 |
| Improvement from Interaction: Number of Stories x Square Footage | 2 | 1.25 |
| Residuals | 6 |
- The scaled deviance of the model without the interaction terms is 2.64
Calculate the F-statistic that is used to evaluate whether the interaction term is significant.
- A) Less than 2.00
- B) At least 2.00, but less than 2.25
- C) At least 2.25, but less than 2.50
- D) At least 2.50, but less than 2.75
- E) At least 2.75
Answer this question and see the worked solution