Final Assessment
ECON 4130: Forecasting for Economics & Business
Instruction:
This Final Assessment consist of 3 questions (QUESTION 1, QUESTION 2 and QUESTION 3)
You are to complete this final assessment ON YOUR OWN without any help from any human being directly or indirectly. However, you are allowed to refer to any written or unwritten references either hardcopy or softcopy.
QUESTION 1
Dream Housing Finance company deals in all kinds of home loans. They have presence across all urban, semi urban and rural areas. Customer first applies for home loan and after that the company validates the customer eligibility for loan. Dream Housing Finance company wants to automate the loan eligibility process based on customer detail provided while filling online application form. These details are Gender, Marital Status, Education, Number of Dependents, Income, Loan Amount, Credit History and others. To automate this process, Dream Housing Finance company has provided a dataset to identify the customers segments that are eligible for loan amount so that they can specifically target these customers.
Using the data in File A you are to explain the behaviour of the data. Using the data in File Aand File B you are required to build the best model that will be able to automate the loan eligibility process. You are required to write a report that clearly explain the process that led to your decision on the best model to automate the process. (40 marks)
Data Dictionary
File A: CSV containing the customers for whom loan eligibility is known as ‘Loan_Status’
Variable
Description
Loan_ID
Unique
Loan ID
Gender
Male/
Female
Married
Applicant
married (Y/N)
Dependents
Number
of dependents
Education
Applicant
Education (Graduate/ Under Graduate)
Self_Employed
Self
employed (Y/N)
ApplicantIncome
Applicant
income
CoapplicantIncome
Coapplicant
income
LoanAmount
Loan
amount in thousands
Loan_Amount_Term
Term of
loan in months
Credit_History
credit history
meets guidelines
Property_Area
Urban/
Semi Urban/ Rural
Loan_Status
(Target)
Loan approved (Y/N)
File B: CSV containing the customer information for whom loan eligibility is to be predicted
Variable
Description
Loan_ID
Unique
Loan ID
Gender
Male/
Female
Married
Applicant
married (Y/N)
Dependents
Number
of dependents
Education
Applicant
Education (Graduate/ Under Graduate)
Self_Employed
Self
employed (Y/N)
ApplicantIncome
Applicant
income
CoapplicantIncome
Coapplicant
income
LoanAmount
Loan
amount in thousands
Loan_Amount_Term
Term of
loan in months
Credit_History
credit
history meets guidelines
Property_Area
Urban/
Semi Urban/ Rural
QUESTION 2
You are given the quarterly Industrial Production Index (IPI) data for Malaysia for the period 1981 Quarter 1 until 2019 Quarter 1 (File C).
You are required to explain the behaviour of the data and come up with the best model that will be able to be used to forecast Malaysia’s economic activities. You have to write a report that clearly explain the process that led to your decision on the best model. (30 marks)
QUESTION 3
You are to forecast the sales of a line of skiwear that is produced by Company ZYXZX. The data on sales and variables that are expected to effect sales are given in File D.
You are required to explain the behaviour of the data and come up with the best model that will be able to be used to forecast ZYXZX sales. You have to write a report that clearly explain the process that led to your decision on the best model.
(30 marks)
