A study of the top MBA programs attempted to predict the average starting salary
ID: 3229556 • Letter: A
Question
A study of the top MBA programs attempted to predict the average starting salary (in $1000's) of graduates of the program based on the amount of tuition (in $1000's) charged by the program and the average GMAT score of the program's students. The results of a regression analysis based on a sample of 75 MBA programs is shown below:
Least Squares Linear Regression of Salary
Predictor
Variables Coefficient Std Error T P VIF
Constant -203.402 51.6573 -3.94 0.0002 0.0
Gmat 0.39412 0.09039 4.36 0.0000 2.0
Tuition 0.92012 0.17875 5.15 0.0000 2.0
R-Squared 0.6857 Resid. Mean Square (MSE) 427.511
Adjusted R-Squared 0.6769 Standard Deviation 20.6763
pt.1
Interpret the coefficient for the tuition variable shown on the printout.
For every $1000 increase in the average starting salary, we estimate that the tuition charged by the MBA program will increase by $920.12.
For every $1000 increase in the tuition charged by the MBA program, we estimate that the average starting salary will increase by $394.12, holding the GMAT score constant
For every $1000 increase in the tuition charged by the MBA program, we estimate that the average starting salary will increase by $920.12, holding the GMAT score constant
For every $1000 increase in the tuition charged by the MBA program, we estimate that the average starting salary will decrease by $203,402, holding the GMAT score constant.
pt. 2
Source DF SS MS F P
Regression 2 67140.9 33570.5 78.53 0.0000
Residual 72 30780.8 427.5
Total 74 97921.7
Interpret the p-value for the global f-test shown on the printout.
At = 0.05, there is insufficient evidence to indicate that the average GMAT score of the MBA program's students is useful for predicting the average starting salary of the graduates of an MBA program.
At = 0.05, there is insufficient evidence to indicate that something in the regression model is useful for predicting the average starting salary of the graduates of an MBA program.
At = 0.05, there is sufficient evidence to indicate that something in the regression model is useful for predicting the average starting salary of the graduates of an MBA program.
At = 0.05, there is insufficient evidence to indicate that the average Tuition score of the MBA program's students is useful for predicting the average starting salary of the graduates of an MBA program.
For every $1000 increase in the average starting salary, we estimate that the tuition charged by the MBA program will increase by $920.12.
For every $1000 increase in the tuition charged by the MBA program, we estimate that the average starting salary will increase by $394.12, holding the GMAT score constant
For every $1000 increase in the tuition charged by the MBA program, we estimate that the average starting salary will increase by $920.12, holding the GMAT score constant
For every $1000 increase in the tuition charged by the MBA program, we estimate that the average starting salary will decrease by $203,402, holding the GMAT score constant.
pt. 2
Source DF SS MS F P
Regression 2 67140.9 33570.5 78.53 0.0000
Residual 72 30780.8 427.5
Total 74 97921.7
Interpret the p-value for the global f-test shown on the printout.
At = 0.05, there is insufficient evidence to indicate that the average GMAT score of the MBA program's students is useful for predicting the average starting salary of the graduates of an MBA program.
At = 0.05, there is insufficient evidence to indicate that something in the regression model is useful for predicting the average starting salary of the graduates of an MBA program.
At = 0.05, there is sufficient evidence to indicate that something in the regression model is useful for predicting the average starting salary of the graduates of an MBA program.
At = 0.05, there is insufficient evidence to indicate that the average Tuition score of the MBA program's students is useful for predicting the average starting salary of the graduates of an MBA program.
Explanation / Answer
pt.1: This depends on your interpretation of the coefficients
Answer to this Qn: Option C
For every $1000 increase in the tuition charged by the MBA program, we estimate that the average starting salary will increase by $920.12, holding the GMAT score constant
Check the coefficient of Tuition as .92012
pt.2
C is again right option
At = 0.05, there is sufficient evidence to indicate that something in the regression model is useful for predicting the average starting salary of the graduates of an MBA program.
This is because pvalue = .00, which is less than .05
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