A study of the top 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 and the average GMAT score of the program's students. The results of a regression analysis based on a sample of 75 MBA programs is shown below: Least Squares Linear Regression of Salary The model was then used to create 95% confidence and prediction intervals for y and for E(Y) when the tuition charged by the MBA program was $75,000 and the GMAT score was 675. The results are shown here: 95% confidence interval for E(Y): ($126,610, $136,640) 95% prediction interval for Y: ($90,113, $173,160) Which of the following interpretations is correct if you want to use the model to estimate Y for a single MBA program?
A) We are 95% confident that the average starting salary for graduates of a single MBA program that charges $75,000 in tuition and has an average GMAT score of 675 will fall between $126,610 and $136,640.
B) We are 95% confident that the average starting salary for graduates of a single MBA program that charges $75,000 in tuition and has an average GMAT score of 675 will fall between $90,113 and $173,16,30.
C) We are 95% confident that the average of all starting salaries for graduates of all MBA programs that charge $75,000 in tuition and have an average GMAT score of 675 will fall between $126,610 and $136,640.
D) We are 95% confident that the average of all starting salaries for graduates of all MBA programs that charge $75,000 in tuition and have an average GMAT score of 675 will fall between $90,113 and $173,16,30.

Question

A study of the top 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 and the average GMAT score of the program's students. The results of a regression analysis based on a sample of 75 MBA programs is shown below: Least Squares Linear Regression of Salary  The model was then used to create 95% confidence and prediction intervals for y and for E(Y) when the tuition charged by the MBA program was $75,000 and the GMAT score was 675. The results are shown here: 95% confidence interval for E(Y): ($126,610, $136,640) 95% prediction interval for Y: ($90,113, $173,160) Which of the following interpretations is correct if you want to use the model to estimate Y for a single MBA program?
A) We are 95% confident that the average starting salary for graduates of a single MBA program that charges $75,000 in tuition and has an average GMAT score of 675 will fall between $126,610 and $136,640. 
B) We are 95% confident that the average starting salary for graduates of a single MBA program that charges $75,000 in tuition and has an average GMAT score of 675 will fall between $90,113 and $173,16,30. 
C) We are 95% confident that the average of all starting salaries for graduates of all MBA programs that charge $75,000 in tuition and have an average GMAT score of 675 will fall between $126,610 and $136,640. 
D) We are 95% confident that the average of all starting salaries for graduates of all MBA programs that charge $75,000 in tuition and have an average GMAT score of 675 will fall between $90,113 and $173,16,30.

Quizplus · Accepted Answer

The Answer of A study of the top 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 and the average GMAT score of the program's students. The results of a regression analysis based on a sample of 75 MBA programs is shown below: Least Squares Linear Regression of Salary  The model was then used to create 95% confidence and prediction intervals for y and for E(Y) when the tuition charged by the MBA program was $75,000 and the GMAT score was 675. The results are shown here: 95% confidence interval for E(Y): ($126,610, $136,640) 95% prediction interval for Y: ($90,113, $173,160) Which of the following interpretations is correct if you want to use the model to estimate Y for a single MBA program?
A) We are 95% confident that the average starting salary for graduates of a single MBA program that charges $75,000 in tuition and has an average GMAT score of 675 will fall between $126,610 and $136,640. 
B) We are 95% confident that the average starting salary for graduates of a single MBA program that charges $75,000 in tuition and has an average GMAT score of 675 will fall between $90,113 and $173,16,30. 
C) We are 95% confident that the average of all starting salaries for graduates of all MBA programs that charge $75,000 in tuition and have an average GMAT score of 675 will fall between $126,610 and $136,640. 
D) We are 95% confident that the average of all starting salaries for graduates of all MBA programs that charge $75,000 in tuition and have an average GMAT score of 675 will fall between $90,113 and $173,16,30.

A Study of the Top MBA Programs Attempted to Predict