A survey of 100 English professors obtained data on their salaries and four explanatory variables: S = salary (thousands of dollars); B = number of published books; A = number of articles published in the last 2 years; E = number of years since degree; and J = 1 if they have received a recent job offer, 0 otherwise. The estimated equation (with t values in brackets) is

a. Which of the explanatory variables are dummy variables?

b. Which, if any, of the estimated signs do you find surprising, perhaps implausible?

c. Which of the estimated coefficients are statistically significant at the 5 percent level?

d. Give a 95 percent confidence interval for the effect on a professor’s annual salary of having an article published. Does your answer seem like a lot of money or a little?

e. According to the estimated equation, will a professor’s salary be increased more by writing an article or a book?

f. What is the predicted annual salary for a professor who has 20 years of experience, one published book, two articles published in the last 2 years, and no recent job offers? Does this prediction seem plausible?

Transcribed Image Text:

S=87.65 +0.42B+2.10A +1.21E+1.36J, R = 0.68 [12.58] [1.77] [4.60] [2.97] [3.45]