A Study of the Top MBA Programs Attempted to Predict

question 43

Multiple Choice

A study of the top MBA programs attempted to predict the average starting salary (in $1000ʹs) of graduates of the program based on the amount of tuition (in $1000ʹs) charged by the program and
The average GMAT score of the programʹs students. The results of a regression analysis based on a
Sample of 75 MBA programs is shown below: Least Squares Linear Regression of Salary

$\begin{array}{l}\text { Predictor }\\\begin{array}{lcccccc}\text { Variables } & \text { Coefficient } & \text { Std Error } & \text { T } & \text { P } & \text { VIF } \\\text { Constant } & -203.402 & 51.6573 & -3.94 & 0.0002 & 0.0 \\\text { Gmat } & 0.39412 & 0.09039 & 4.36 & 0.0000 & 2.0 \\\text { Tuition } & 0.92012 & 0.17875 & 5.15 & 0.0000 & 2.0 & \\& & & & & & \\\text { R-Squared } & 0.6857 & \text { Resid. Mean Square (MSE) } & 427.511 \\\text { Adjusted R-Squared } & 0.6769 &{\text { Standard Deviation }} & 20.6763\end{array}\end{array}$

Interpret the coefficient for the tuition variable shown on the printout.

• A) For every \(\$ 1000\) increase in the tuition charged by the MBA program, we estimate that the average starting salary will decrease by \(\$ 203,402\), holding the GMAT score constant.
• B) For every \(\$ 1000\) increase in the average starting salary, we estimate that the tuition charged by the MBA program will increase by \(\$ 920.12\).
• C) For every \(\$ 1000\) increase in the tuition charged by the MBA program, we estimate that the average starting salary will increase by \(\$ 920.12\), holding the GMAT score constant
• D) For every \(\$ 1000\) increase in the tuition charged by the MBA program, we estimate that the average starting salary will increase by \(\$ 394.12\), holding the GMAT score constant

---

Definitions:

Mesozoic Era

Span of geologic time commonly known as the Age of Reptiles; divided into Triassic (252–201 mya), Jurassic (201–145 mya), and Cretaceous (145–66 mya) periods; ended with the mass extinction of the dinosaurs and many other species.

Dominant Life Form

The prevailing organisms in a particular ecosystem, characterized by their extensive presence and influence on that environment.

Reptiles

Vertebrates characterized by dry skin with horny scales and adaptations for terrestrial reproduction; include turtles, snakes, and alligators; reptiles are a paraphyletic group unless birds are included.

Eons

The largest division of geological time, comprising multiple eras, and spanning hundreds of millions to billions of years, marking significant changes in the Earth's geology and biological history.