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

question 22

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. $$\begin{array} { l l l l r } & \text { School } & \text { GMAT } & \text { Acc. Rate } & \text { Salary } \\\hline\text { 1. } & \text { Harvard } & 644 & 15.0 \% & \$ 63,000 \\2 . & \text { Stanford } & 665 & 10.2 & 60,000 \\3 . & \text { Penn } & 644 & 19.4 & 55,000 \\4 . & \text { Northwestern } & 640 & 22.6 & 54,000 \\\text { 5. } & \text { MIT } & 650 & 21.3 & 57,000 \\6 . & \text { Chicago } & 632 & 30.0 & 55,269 \\7 . & \text { Duke } & 630 & 18.2 & 53,300 \\\text { 8. } & \text { Dartmouth } & 649 & 13.4 & 52,000 \\9 . & \text { Virginia } & 630 & 23.0 & 55,269 \\\text { 10. } & \text { Michigan } & 620 & 32.4 & 53.300 \\\text { 11. } & \text { Columbia } & 635 & 37.1 & 52,000 \\\text { 12. } & \text { Cornell } & 648 & 14.9 & 50,700 \\\text { 13. } & \text { CMU } & 630 & 31.2 & 52,050 \\\text { 14. } & \text { UNC } & 625 & 15.4 & 50,800 \\\text { 15. } & \text { Cal-Berkeley } & 634 & 24.7 & 50,000 \\\text { 16. } & \text { UCLA } & 640 & 20.7 & 51,494 \\\text { 17. } & \text { Texas } & 612 & 28.1 & 43,985 \\\text { 18. } & \text { Indiana } & 600 & 29.0 & 44,119 \\\text { 19. } & \text { NYU } & 610 & 35.0 & 53,161 \\\text { 20. } & \text { Purdue } & 595 & 26.8 & 43,500 \\\text { 21. } & \text { USC } & 610 & 31.9 & 49,080 \\\text { 22. } & \text { Pittsburgh } & 605 & 33.0 & 43,500 \\\text { 23. } & \text { Georgetown } & 617 & 31.7 & 45,156 \\24 . & \text { Maryland } & 593 & 28.1 & 42,925 \\25 . & \text { Rochester } & 605 & 35.9 & 44,499\end{array}$$ 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. $$\beta _ { 0 } = - 92040 \quad \hat { \beta } _ { 1 } = 228 \quad s = 3213 \quad r ^ { 2 } = .66 \quad r = .81 \quad \mathrm { df } = 23 \quad t = 6.67$$
-A 95% prediction interval for SALARY when GMAT = 600 is ($37,915, $51,948) . Interpret this interval for the situation above.

• A) We are 95% confident that the SALARY of a top business school graduate will fall between $37,915 and $51,984.
• B) We are 95% confident that the increase in SALARY for a 600-point increase in GMAT will fall between $37,915 and $51,984.
• C) We are 95% confident that the SALARY of a top business school graduate with a GMAT of 600 will fall between $37,915 and $51,984.
• D) We are 95% confident that the mean SALARY of all top business school graduates with GMATs of 600 will fall between $37,915 and $51,984.

Explain the role of unions in affecting wages and employment for union and non-union workers.

Evaluate the impact of union strategies on wage and employment outcomes in labor markets.

Identify factors contributing to wage inequalities and changes in the labor market.

Understand the concept of bilateral monopoly and its implications for wage setting.

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Definitions:

Marginal Product

The increase in output that results from employing one more unit of a particular input, holding all other inputs constant.

Total Product

The total quantity of output produced by a firm from a given quantity of inputs during a certain period of time.

Workers

Individuals engaged in some form of employment or labor, contributing their skills or effort in exchange for compensation.

Marginal Product

The additional output that is produced by adding one more unit of a specific input, while keeping other inputs constant.