A credit score cutoff for loans as a natural experiment
A lender automatically approves small-business loans for applicants with a credit score of at least 620 and rejects everyone below. You want to know the effect of receiving the loan on whether the business survives two years later.
Explain how a regression discontinuity design answers this, why it is nearly random at the cutoff, the key assumption to check, and the limitation.
Your answer
This one is open-ended. Work it through, then check your reasoning against the full solution.