For the Situation Above, Give a Practical Interpretation Of $\hat { \beta } _ { 0 } = - 92040$

question 43

Multiple Choice

For the situation above, give a practical interpretation of $\hat { \beta } _ { 0 } = - 92040$ .

• A) We estimate SALARY to decrease \(\$ 92,040\) for every 1 -point increase in GMAT.
• B) The value has no practical interpretation since a GMAT of 0 is nonsensical and outside the range of the sample data.
• C) We estimate the base SALARY of graduates of a top business school to be \(- \$ 92,040\).
• D) We expect to predict SALARY to within \(2 ( 92040 ) = \$ 184,080\) of its true value using GMAT in a straight-line model.

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Definitions:

Life Insurance

A contract between an insurer and a policyholder, providing a death benefit to beneficiaries in exchange for premiums paid by the policyholder.

Positive Reinforcement

An approach to encourage a specific behavior by offering a reward or positive outcome after the behavior is exhibited.

Contingent

Dependent on or conditioned by something else; not absolute or certain.

Pleasant Event

An occurrence or activity that brings joy, satisfaction, or positive feelings to an individual.