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Financial institutions have a legal and social responsibility to serve all communities. Do banks adequately serve both inner city and suburban neighborhoods, both poor and wealthy communities? In New Jersey. banks have been charged with withdrawing from urban I areas with a high percentage of minorities. To examine this charge, a regional New Jersey newspaper, the Asbury Park Press, compiled county by county data on the number (y) of people in each county per branch , bank in the county and the percentage (x) of the population in each county that is minority. These data for each of New Jersey's 21 counties are provided in the table above
a. Plot the data in a scattergram. What pattern, if any, does the plot reveal?
b. Consider the linear model E(y) = ß0 + ß1x. If, in fact, the charge against the New Jersey banks is true, then an increase in the percentage of minorities (x) will lead to a decrease in the number of bank branches in a county and therefore will result in an increase in the number of people (y) per branch. Will the value of ß1 positive or negative in this situation?
c. Do these data support or refute the charge made against the New Jersey banking community? Test using a = .01
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