A Study of the Top 75 MBA Programs Attempted to Predict

question 100

Multiple Choice

A study of the top 75 MBA programs attempted to predict the average starting salary (in $1000's) of graduates of the program based on the amount of tuition (in $1000's) charged by the program.
The results of a simple linear regression analysis are shown below: Least Squares Linear Regression of Salary
Predictor


Interpret the estimated slope of the regression line.

• A) For every \(\$ 1000\) increase in the tuition charged by the MBA program, we estimate that the average starting salary will increase by \(\$ 1474.94\).
• B) For every \(\$ 1000\) increase in the tuition charged by the MBA program, we estimate that the average starting salary will decrease by \(\$ 1474.94\).
• C) For every \(\$ 1474.94\) increase in the tuition charged by the MBA program, we estimate that the average starting salary will increase by \(\$ 18,184.90\).
• D) For every \(\$ 1000\) increase in the average starting salary, we estimate that the tuition charged by the MBA program will increase by \(\$ 1474.94\).

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Definitions:

Herfindahl-Hirschman Index

A measure of market concentration and competition, calculated by squaring the market share of each firm competing in a market and summing the resulting numbers.

Concentrated Industry

An economic sector characterized by a small number of firms holding a large market share, leading to reduced competition.

Fuel-efficient Cars

Vehicles designed to use less fuel for the same distance traveled compared to standard vehicles, typically through advanced technology or design.

Concentration Ratio

A measure that assesses the level of market concentration, indicating the combined market share of the top firms (usually the top 4 or 8) in the industry.