Is an MBA a golden ticket? Pursuing an MBA is a major personal investment. Tuiti

Question

Is an MBA a golden ticket? Pursuing an MBA is a major personal investment. Tuition and expenses associated with business school programs are costly but the high costs come with hopes of career advancement and big salaries. A prospective MBA student would like to examine the factors that impact starting salary upon graduation and decides to develop a model that uses program per-year tuition as a predictor of starting salary. The sample regression line has an intercept of -23,140 and the slope of 2.6. For a student who spent $50,161 on tuition per year what is the predicted starting salary? Hint: Answer should be accurate to 1 decimal place.

Explanation / Answer

The regression equation is Y = -23140+2.6X

when X = 50161,

Predicted Starting salary is Y = -23140+2.6*50161 =107278.6

Answer:  Predicted Starting salary is $107,278.6

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