Is There a Relationship Between the Raises Administrators at State $$E ( y ) = \beta _ { 0 } + \beta _ { 1 } x$$

question 113

Multiple Choice

Is there a relationship between the raises administrators at State University receive and their performance on the job?
A faculty group wants to determine whether job rating (x) is a useful linear predictor of raise (y) .
Consequently, the group considered the straight-line regression model $$E ( y ) = \beta _ { 0 } + \beta _ { 1 } x$$ Using the method of least squares, the faculty group obtained the following prediction equation: $$\hat { y } = 14,000 - 2,000 x$$ Interpret the estimated y-intercept of the line.

• A) There is no practical interpretation, since rating of 0 is nonsensical and outside the range of the sample data.
• B) For an administrator who receives a rating of zero, we estimate his or her raise to be $14,000.
• C) For a 1-point increase in an administrator's rating, we estimate the administrator's raise to increase $14,000.
• D) The base administrator raise at State University is $14,000.

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Definitions:

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