Nanyang Technological University
Nanyang Business School
AB103 Statistics and Quantitative Methods
Case Study: Property Purchase Strategy
Table of Contents
Reasons for choosing 21 Years for Analysis
Other Indicators of Aging
Suitability of a Linear Model
Linear Correlation Testing
Recommendations and Insights
2.1. Problem Context
The age structure of a population affects a nation's key socioeconomic issues. Countries with young populations (high percentage under age 15) need to invest more in schools, while countries with older populations (high percentage ages 65 and over) need to invest more in the health sector. The age structure can also be used to help predict potential political issues. For example, the rapid growth of a young adult population unable to find employment can lead to unrest. The age structure also hints business opportunities. For example, an aging population requires more old folk home services.
In this case study, we are doing an analysis on Singapore’s population, from Year 1990 to Year 2010, to examine whether Singapore has symptoms of becoming an aging population. We will then proceed on with recommendations for the situation that Singapore is currently facing.
2.2. Reasons for choosing 21 Years for Analysis
The length of 21 years is suitable for carrying out the analysis because firstly it consists of 2 generations. Thereofre our model can be tested with the passing of 2 generations. Secondly withing the span of 21 years another generation can enter the data thus the model can be further tested. Moreover to get a good aproximate of the coefficient of correlation having data with n > 20 is better.
2.3. Other Indicators of Aging
* Old Age Support Ratio (Refer to Appendix A Fig. 1)
The graph shown indicates the number of residents aged 15-64, who are supporting an elderly resident aged 65 years and over. Over the decades, there is a decrease in the numbers, which actually indicates that there are lesser proportion of the working population and more of the elderly population which needs to be supported by them. Thus, this is another indicator of an aging population because there is an increasingly large number of the elderly.
* Low Birth Rate (Refer to Appendix A Fig. 2)
From the diagram, it is shown that Singapore has one of the lowest birth rates in the world, with 8.99 births per 1000 population. As such, the population growth is significantly small. The proportion of the elderly in the population increases at a faster rate than that of the population growth.
* Life expectancy (Refer to Appendix A Fig. 3)
Another indicator that shows that can possibly indicate aging would be the life expectancy of a country. When the life expectancy is higher, people will tend to live longer and thus there will be more elderly people in the population. Such a trend can effectively contribute to an aging population. From the diagram, Singapore is ranked 3rd with an average life expectancy at birth of 81.89. This would thus indicate that Singapore is likely to experience aging when more of its people can live up to an average age of 82 years old.
2. Data Analysis
3.4. Suitability of a Linear Model
Scattergrams are used to graphically describe a relationship between two variables, x and y. From the scatter plot above, we can see that as x increases, y also increases, so a linear model can be used to reflect the deterministic component of the relationship between x and y.
3.5. Correlation Analysis
The r value of 0.986 indicates a strong positive linear relation between the...
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