The annual salary of an employee y (in thousands of dollars) is estimated as a function of years of experience x ; a dummy variable d that equals 1 for college graduates and 0 for those graduating high school but not college; and a product of this dummy variable and experience, xd. The estimated salary is given by Ŷ = 30.3 + 1.2x + 15.5d + 2.0xd.

a. What is the predicted salary of a college graduate who has 5 years of experience? What is the predicted salary of a college graduate who has 15 years of experience?

b. What is the predicted salary of a non-college graduate who has 5 years of experience? What is the predicted salary of a non-college graduate who has 15 years of experience?

c. Discuss the impact of a college degree on salary.