Question

A mortgage bank randomly samples the accounts of its timeshare customers. Indicate if each of the following variables is categorical or numerical. If it is categorical, indicate the level of measurement. If it is numerical, is it discrete or continuous?

a. The original purchase price of a customer's timeshare unit.

b. The place of residence of a timeshare owner.

c. The degree of satisfaction of a timeshare owner with the maintenance of the unit purchased (from 1: very dissatisfied to 5: very satisfied).

d. The number of times the customer has been late in paying.

Answer 1

a.

The original purchase price of a customer's timeshare unit is a numerical variable because it can be measured in numbers. And it is a discrete variable because it takes only finite values.

b.

The place of residence of a timeshare owner is a categorical variable because it cannot be measured in numbers but it can have several categories, that is, several places categorised by state or country or province. And the level of measurement is nominal because there is no order for the categories of places of residence.

c.

The degree of satisfaction of a timeshare owner with the maintenance of the unit purchased is a categorical variable because it cannot be measured in numbers but can have several categories(here, 5). And the level of measurement is ordinal because the degree of satisfaction has an order (here, from 1: very dissatisfied to 5: very satisfied).

Note: 1 to 5 are just codes given to categories. They do not have any numerical importance.

d.

The number of times the customer has been late in paying is a numerical data because it can be measured in numbers and it is a discrete variable because the number of times the customer has been late in paying can only be a finite number, always.