Phase 1 (Proposal)

According to Experian.com, a recent study found that American consumers’ average monthly debt payments are around $1,000 (November 11, 2010). However, depending on where the consumer lives, there are non-negligible variations in debt payments in 26 metropolitan areas. For example, residents who live in Washington DC pay the most monthly debt payments of $1,285. On the other hand, residents who live in Pittsburgh pay the least monthly debt payments of $763.

Madelyn Davis is an economist in a large bank. She thinks that the primary reason for the disparate debt payments is due to the differences in income between cities. For instance, the high salaries in Washington, DC, could have been contributed to its inclusion on the list. Also, she’s concerned about how the unemployment rate would affect consumer debt payments. Madelyn gathered data from the same 26 metropolitan cities utilized in the last debt payment study to examine the relationship between income, unemployment rate, and consumer debt payments. She obtained information on each area’s median household income from 2010 to 2011 and the monthly unemployment rate and average consumer debt for August 2010.

There are three variables included in the case that are income, unemployment rate, and consumer debt payments between 26 metropolitan cities.

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