Description
Describe your approach to solving the exercises, solve the exercise (including the last part), and write a two-sentence summary of the conclusion based upon your solution.
13.6 Is an MBA a golden ticket? Pursuing an MBA is a major personal investment. Tuition and expenses associated with business school programs are costly, but the high costs come with hopes of career advancement and high salaries. A prospective MBA student would like to examine the factors that impact starting salary upon graduation and decides to develop a model that uses program per-year tuition as a predictor of starting salary. Data were collected for 37 full-time MBA programs offered at private universities. The data are stored in FTMBA.
Source: Data extracted from U.S. News Business School Compass, available at premium.usnews.com/best-graduate-schools/top-business-schools/mba-rankings.
a. Construct a scatter plot.
b. Assuming a linear relationship, 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 starting salary upon graduation for a program that has a per-year tuition cost of $50,450.
e.What insights do you gain about the relationship between pro-gram per-year tuition and starting salary upon graduation?
13.7 Starbucks Coffee Co. uses a data-based approach to improve the quality and customer satisfaction of its products. When survey data indicated that Starbucks needed to improve its package-sealing process, an experiment was conducted to determine the factors in the bag-sealing equipment that might be affecting the ease of opening the bag without tearing the inner liner of the bag.
Source: Data extracted from L. Johnson and S. Burrows, For Starbucks, Its in the Bag, Quality Progress, March 2011, pp. 1723.
One factor that could affect the rating of the ability of the bag to resist tears was the plate gap on the bag-sealing equipment. Data were collected on 19 bags in which the plate gap was varied. The results are stored in Starbucks.
a. Construct a scatter plot.
b. Assuming a linear relationship, 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 tear rating when the plate gap is equal to 0.
e. what should you tell management of Starbucks about the relationships between the plate gap and the tear rating?
13.8 The value of a sports franchise is directly related to the amount of revenue that a franchise can generate. The file MLB Values represents the current value in a recent year (in $millions) and the annual revenue (in $millions) for the 30 MLB baseball teams.
Source: Data extracted from www.forbes.com/mlb-valuations/list.
Suppose you want to develop a simple linear regression model to predict current value based on annual revenue generated.
a. Construct a scatter plot.
b. Use the least-squares method to determine the regression coefficients b0 and b1.
c. Interpret the meaning of b0 and b1 in this problem.
d. Predict the mean current value of a baseball team that generates $250 million of annual revenue.
e. What would you tell a group considering an investment in a MLB baseball team about the relationship between revenue and the current value of a team?
