Question

A researcher interviews 50 employees of a large manufacturer and collects data on each worker’s hourly wage (Wage), years of higher education (EDUC), experience (EXPER), and age (AGE). The data is shown below; the data set can also be found on the text website; labeled Hourly Wage.

Wage	EDUC	EXPER	AGE
37.85	11	2	40
21.72	4	1	39
14.34	4	2	38
21.26	5	9	53
24.65	6	15	59
25.65	6	12	36
15.45	9	5	45
20.39	4	12	37
29.13	5	14	37
27.33	11	3	43
18.02	8	5	32
20.39	9	18	40
24.18	7	1	49
17.29	4	10	43
15.61	1	9	31
35.07	9	22	45
40.33	11	3	31
20.39	4	14	55
16.61	6	5	30
16.33	9	3	28
23.15	6	15	60
20.39	4	13	32
14.88	4	9	58
13.88	5	4	28
17.65	6	5	40
15.45	6	2	37
26.35	4	18	52
19.15	6	4	44
16.61	6	4	57
18.39	9	3	30
15.45	5	8	43
18.02	7	6	31
13.44	4	3	33
17.66	6	23	51
16.96	4	15	37
14.34	4	9	45
15.45	6	3	55
17.43	5	14	57
35.89	9	16	36
20.39	4	20	60
11.81	4	5	35
15.45	9	10	34
17.66	5	4	28
13.87	6	1	25
16.35	7	10	43
15.45	9	2	42
23.67	4	17	47
16.02	11	2	46
23.15	4	15	52
24.14	8	11	6

Please use either Minitab or Excel to develop both the scatter plots and find the correlation coefficients.

A. Which variable is the response variable? Which variables are the explanatory variables?

B. Develop a scatter plot comparing wage to education. Interpret the plot.

C. Develop a scatter plot comparing wage to experience. Interpret the plot.

D. Compute the correlation coefficients for wage and education and wage and experience. Then perform a hypothesis test for both correlations to determine if the correlations are statistically significant. Be sure to show the null and alternative hypotheses, decision rule, decisions and conclusions. Use alpha = .05. Note: Since the hypotheses and decision rule are the same for both tests, only need to write those steps once.  

E. Which of the explanatory variables provides the best predictor of the response variable? Support your response by citing both the scatter plot and correlation test.

Answer 1