You are a loan officer trying to decide which clients deserve your consideration out of several loan applicants.
| Name | Experian | Equifax |
| :------ | :------- | :------ |
| Kellin | 720 | 780 |
| Natasha | 699 | 680 |
| Edward | 789 | 650 |
| Lisa | 10 | 670 |
Based on each applicant's median credit score, who deserves your consideration?
A. Kellin
B. Natasha
C. Edward
D. Lisa
Answer (2)
Calculate the median credit score for each applicant by averaging their Experian and Equifax scores.
Kellin's median score is calculated as ( 720 + 780 ) /2 = 750 .
Natasha's median score is calculated as ( 699 + 680 ) /2 = 689.5 .
Edward's median score is calculated as ( 789 + 650 ) /2 = 719.5 .
Lisa's median score is calculated as ( 10 + 670 ) /2 = 340 .
Kellin has the highest median credit score, therefore the answer is a .
Explanation
Problem Analysis We are given the Experian and Equifax credit scores for four loan applicants: Kellin, Natasha, Edward, and Lisa. To determine who deserves the loan, we need to calculate the median credit score for each applicant and choose the one with the highest median score.
Kellin's Median Score For Kellin, the Experian score is 720 and the Equifax score is 780. The median credit score is calculated as: ( 720 + 780 ) /2 = 1500/2 = 750
Natasha's Median Score For Natasha, the Experian score is 699 and the Equifax score is 680. The median credit score is calculated as: ( 699 + 680 ) /2 = 1379/2 = 689.5
Edward's Median Score For Edward, the Experian score is 789 and the Equifax score is 650. The median credit score is calculated as: ( 789 + 650 ) /2 = 1439/2 = 719.5
Lisa's Median Score For Lisa, the Experian score is 10 and the Equifax score is 670. The median credit score is calculated as: ( 10 + 670 ) /2 = 680/2 = 340
Comparison of Median Scores Comparing the median credit scores, we have:
Kellin: 750
Natasha: 689.5
Edward: 719.5
Lisa: 340
The highest median credit score is 750, which belongs to Kellin.
Final Answer Therefore, based on the median credit score, Kellin deserves the loan. The answer is a.
Examples
Credit scores are used in many real-life scenarios, such as applying for a mortgage, a car loan, or even renting an apartment. Lenders and landlords use credit scores to assess the risk of lending money or renting property to an individual. A higher credit score typically indicates a lower risk, making it more likely for the individual to be approved for the loan or rental. For example, if you want to buy a house, the bank will check your credit score to determine the interest rate they will offer you. A higher credit score can result in a lower interest rate, saving you money over the life of the loan.
To find out which loan applicant deserves consideration, we calculated their median credit scores. Kellin had the highest median score of 750, making her the most qualified applicant. Therefore, the answer is A: Kellin.
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