An Academic Advisor Wants to Predict the Typical Starting Salary

question 48

Multiple Choice

An academic advisor wants to predict the typical starting salary of a graduate at a top business school using the GMAT score of the school as a predictor variable. A simple linear regression of
SALARY versus GMAT was created from a set of 25 data points.
Which of the following is not an assumption required for the simple linear regression analysis to
Be valid?

• A)The errors of predicting SALARY are normally distributed.
• B)SALARY is independent of GMAT.
• C)The errors of predicting SALARY have a mean of 0.
• D)The errors of predicting SALARY have a variance that is constant for any given value of GMAT.

---

Definitions:

Work Days

Days on which business is conducted, typically excluding weekends and public holidays.

Wage Rise

An increase in the rate of pay employees receive for their work, often as a result of negotiation, economic conditions, or to match inflation rates.

Compensated Absences

A provision for employees’ paid time off, including leave for vacations, illnesses, and personal reasons.

Short-Term

Refers to a time horizon or a period within twelve months or within an entity's operating cycle if it's longer.