Regression problem

Tuition per year ($)

Average GMAT score

Acceptance Rate (%)

Graduates employed at graduation (%)

Average starting salary and bonus (5)

School

1

63675

729

10.7

79.3

153830

67516

730

19.6

85.8

155058

66540

726

23.6

84.9

147475

67938

724

11.7

81.2

143565

66462

728

20.1

82.8

141694

66540

737

6.0

62.8

153553

66390

717

22.4

86.8

148997

8

68792

720

14.1

77.3

150229

9

64200

725

19.0

76.0.

135988

10

63200

695

22.1

83.1

144799

11

66588

710

23.1

82.1

145413

12

61584

700

27.6

79.8

146252

13

61440

686

30.3

76.0

140289

14

57000

683

33.1

84.0

138864

15

55050

692

44.6

69.1

124417

16

55400

688

29.7

78.5

115830

17

55474

692

33.3

75.2

126932

18

51900

691

45.5

80.3

129587

19

53000

690

26.6

75.2

131829

20

50326

683

41.0

75.7

122791

21

46000

665

33.6

78.6

113515

22

47340

667

38.2

75.3

109267

23

49800

682

37.1

65.7

111165

24

45976

662

38.6

60.7

108347

25

37996

621

40.0

63.6

80249

26

47800

642

55.3

56.5

80249

27

46860

641

54.9

68.4

101799

28

49959

651

63.1

53.6

76455

29

38250

632

64.3

60.0

86123

30

33328

623

58.5

94.9

73646

31

43290

622

55.7

18.9

75879

32 41804

558

52.0

63.6

52190

33

49400

567

82.9

26.7

64891

34

33996

498

33.7

54.2

102156

35

23020

482

90.2

61.8

55918

36

41490

486

59.3

35.7

80000

37

39100

545

94.5

42.6

53848

 Is an MBA a golden Ɵcket? Pursuing an MBA is a major personal investment. TuiƟon and

expenses associated with business school programs are costly, but the high costs come

with hopes of career advancement and high salaries. A prospecƟve MBA student would

like to examine the factors that impact starƟng salary upon graduaƟon and decides to

develop a model that uses program per year tuiƟon as a predictor of starƟng salary. Data

were collected for 37 full-Ɵme MBA programs offered at private universiƟes.

a. Construct a scaƩer plot.

b. Assuming a linear relaƟonship, use the least-squares method to determine the

regression coefficients b0 and b1.

c. Interpret the meaning of the slope, b1, in this problem.

d. Predict the mean starƟng salary upon graduaƟon for a program that has a per-year

tuiƟon cost of $50,450.

e. What insights do you gain about the relaƟonship between program per-year tuiƟon and

starƟng salary upon graduaƟon?