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To Examine the Differences Between Salaries of Male and Female

question 77

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To examine the differences between salaries of male and female middle managers of a large bank, 90 individuals were randomly selected, and two models were created with the following variables considered: Salary = the monthly salary (excluding fringe benefits and bonuses) ,
Educ = the number of years of education,
Exper = the number of months of experience,
Train = the number of weeks of training,
Gender = the gender of an individual; 1 for males, and 0 for females.
The Excel partial outputs corresponding to these models are available and shown below.
Model A: Salary = β0 + β1Educ + β2Exper + β3Train + β4Gender + ε To examine the differences between salaries of male and female middle managers of a large bank, 90 individuals were randomly selected, and two models were created with the following variables considered: Salary = the monthly salary (excluding fringe benefits and bonuses) , Educ = the number of years of education, Exper = the number of months of experience, Train = the number of weeks of training, Gender = the gender of an individual; 1 for males, and 0 for females. The Excel partial outputs corresponding to these models are available and shown below. Model A: Salary = β<sub>0</sub> + β<sub>1</sub>Educ + β<sub>2</sub>Exper + β<sub>3</sub>Train + β<sub>4</sub>Gender + ε Model B: Salary = β<sub>0</sub> + β<sub>1</sub>Educ + β<sub>2</sub>Exper + β<sub>3</sub>Gender + ε A group of female managers considers a discrimination lawsuit if on average their salaries could be statistically proven to be lower by more than $500 than the salaries of their male peers with the same level of education and experience. Using Model B, what is the conclusion of the appropriate test at 10% significance level? A) Do not reject H<sub>0</sub>; the salaries of female managers cannot be proven to be lower on average by more than $500. B) Reject H<sub>0</sub>; the salaries of female managers cannot be proven to be lower on average by more than $500. C) Do not reject H<sub>0</sub>; the salaries of female managers are lower on average by more than $500. D) Reject H<sub>0</sub>; the salaries of female managers are lower on average by more than $500. Model B: Salary = β0 + β1Educ + β2Exper + β3Gender + ε To examine the differences between salaries of male and female middle managers of a large bank, 90 individuals were randomly selected, and two models were created with the following variables considered: Salary = the monthly salary (excluding fringe benefits and bonuses) , Educ = the number of years of education, Exper = the number of months of experience, Train = the number of weeks of training, Gender = the gender of an individual; 1 for males, and 0 for females. The Excel partial outputs corresponding to these models are available and shown below. Model A: Salary = β<sub>0</sub> + β<sub>1</sub>Educ + β<sub>2</sub>Exper + β<sub>3</sub>Train + β<sub>4</sub>Gender + ε Model B: Salary = β<sub>0</sub> + β<sub>1</sub>Educ + β<sub>2</sub>Exper + β<sub>3</sub>Gender + ε A group of female managers considers a discrimination lawsuit if on average their salaries could be statistically proven to be lower by more than $500 than the salaries of their male peers with the same level of education and experience. Using Model B, what is the conclusion of the appropriate test at 10% significance level? A) Do not reject H<sub>0</sub>; the salaries of female managers cannot be proven to be lower on average by more than $500. B) Reject H<sub>0</sub>; the salaries of female managers cannot be proven to be lower on average by more than $500. C) Do not reject H<sub>0</sub>; the salaries of female managers are lower on average by more than $500. D) Reject H<sub>0</sub>; the salaries of female managers are lower on average by more than $500. A group of female managers considers a discrimination lawsuit if on average their salaries could be statistically proven to be lower by more than $500 than the salaries of their male peers with the same level of education and experience. Using Model B, what is the conclusion of the appropriate test at 10% significance level?

Definitions:

Externality Compensation

Payments or remedies provided to offset the unintended negative or positive effects imposed on third parties by the production or consumption of goods and services.

Efficient Outcome

An allocation of resources in which it is impossible to make any one individual better off without making at least one individual worse off.

Marginal Cost

The cost associated with producing one additional unit of output, focusing on how total production costs change with production volume adjustments.

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