A Study of the Top 75 MBA Programs Attempted to Predict

question 3

Multiple Choice

A study of the top 75 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. The results of a simple linear regression analysis are shown below: Least Squares Linear Regression of Salary

$\begin{array}{lrccl}\text {Predictor}\\\text { Variables } & \text { Coefficient } & \text { Std Error } & \text { T } & \text { P } \\\text { Constant } & 18.1849 & 10.3336 & 1.76 & 0.0826 \\\text { Size } & 1.47494 & 0.14017 & 10.52 & 0.0000\end{array}$

$\begin{array}{lccc}\text { R-Squared } & 0.6027 & \text { Resid. Mean Square (MSE) } & 532.986 \\\text { Adjusted R-Squared } & 0.5972 & \text { Standard Deviation } & 23.0865\end{array}$

Interpret the estimated slope of the regression line.

• A) For every $1000 increase in the tuition charged by the MBA program, we estimate that the average starting salary will decrease by $1474.94.
• B) For every $1000 increase in the average starting salary, we estimate that the tuition charged by the MBA program will increase by $1474.94.
• C) For every $1000 increase in the tuition charged by the MBA program, we estimate that the average starting salary will increase by $1474.94.
• D) For every $1474.94 increase in the tuition charged by the MBA program, we estimate that the average starting salary will increase by $18,184.90.

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