(Situation P) Below Are the Results of a Survey of America's

question 112

Multiple Choice

(Situation P) Below are the results of a survey of America's best graduate and professional schools. The top 25 business schools, as determined by reputation, student selectivity, placement success, and graduation rate, are listed in the table.
For each school, three variables were measured: (1) GMAT score for the typical incoming student; (2) student acceptance rate (percentage accepted of all students who applied) ; and (3) starting salary of the typical graduating student.
$$\begin{array} { l l l l l } & \text { School } & \text { GMAT } & \text { Acc. Rate } & \text { Salary } \\\hline\text { 1. } & \text { Harvard } & 644 & 15.0 \% & \$ 63,000 \\2 . & \text { Stanford } & 665 & 10.2 & 60,000 \\3 . & \text { Penn } & 644 & 19.4 & 55,000 \\4 . & \text { Northwestern } & 640 & 22.6 & 54,000 \\5 . & \text { MIT } & 650 & 21.3 & 57,000 \\6 . & \text { Chicago } & 632 & 30.0 & 55,269 \\7 . & \text { Duke } & 630 & 18.2 & 53,300 \\8 . & \text { Dartmouth } & 649 & 13.4 & 52,000 \\9 . & \text { Virginia } & 630 & 23.0 & 55,269 \\10 . & \text { Michigan } & 620 & 32.4 & 53.300 \\11 . & \text { Columbia } & 635 & 37.1 & 52,000 \\\text { 12. } & \text { Cornell } & 648 & 14.9 & 50,700 \\\text { 13. } & \text { CMU } & 630 & 31.2 & 52,050 \\14 . & \text { UNC } & 625 & 15.4 & 50,800 \\15 . & \text { Cal-Berkeley } & 634 & 24.7 & 50,000 \\16 . & \text { UCLA } & 640 & 20.7 & 51,494 \\\text { 17. } & \text { Texas } & 612 & 28.1 & 43,985 \\\text { 18. } & \text { Indiana } & 600 & 29.0 & 44,119 \\\text { 19. } & \text { NYU } & 610 & 35.0 & 53,161 \\\text { 20. } & \text { Purdue } & 595 & 26.8 & 43,500 \\21 . & \text { USC } & 610 & 31.9 & 49,080 \\\text { 22. } & \text { Pittsburgh } & 605 & 33.0 & 43,500 \\23 . & \text { Georgetown } & 617 & 31.7 & 45,156 \\24 . & \text { Maryland } & 593 & 28.1 & 42,925 \\25 . & \text { Rochester } & 605 & 35.9 & 44,499\end{array}$$
The academic advisor wants to predict the typical starting salary of a graduate at a top business school using GMAT score of the school as a predictor variable. A simple linear regression of SALARY versus GMAT using the 25 data points in the table are shown below.
$$\beta _ { 0 } = - 92040 \quad \hat { \beta } _ { 1 } = 228 \quad s = 3213 \quad r ^ { 2 } = .66 \quad r = .81 \quad \mathrm { df } = 23 \quad t = 6.67$$
-For the situation above, give a practical interpretation of $\mathrm { s } = 3213$ .

• A) We expect to predict SALARY to within \(2 ( 3213 ) = \$ 6,426\) of its true value using GMAT in a straight-line model.
• B) Our predicted value of SALARY will equal \(2 ( 3213 ) = \$ 6,426\) for any value of GMAT.
• C) We estimate SALARY to increase \(\$ 3,213\) for every 1-point increase in GMAT.
• D) We expect the predicted SALARY to deviate from actual SALARY by at least \(2 ( 3213 ) = \$ 6,426\) using GMAT in a straight-line model.

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Definitions:

Scientific Method

A systematic process used for investigating phenomena, acquiring new knowledge, or correcting and integrating previous knowledge.

Evolutionary Psychology

A method within the social and natural sciences focusing on analyzing the mental constitution from a current evolutionary standpoint.

Functionalism

A theory in psychology that focuses on the purpose mental processes serve in enabling people to adapt to their environment.

Career Setting

The environment or context in which an individual's professional life develops, including the type of work, the industry, and the organizational culture.