Question

(Use Excel) For many the promise of a college degree has turned to disappointment as they find themselves struggling to find a job (Financial Times, June 1, 2012). It is especially disturbing since recent evidence suggests that graduating at bad economic times can impact the person’s earning power for a long time. An associate dean at a prestigious college wants to determine if the starting salary of his college graduates has declined from 2008 to 2010. He expects the variance of the salaries to be different between these two years. The accompanying table shows a portion of the salary data for 40 college graduates. Use Table 2. Salary 2008 ($) Salary 2010 ($) Salary 2008 ($) Salary 2010 ($) 34,000 38,000 44,000 43,000 54,000 62,000 41,000 30,000 50,000 32,000 34,000 43,000 53,000 40,000 50,000 61,000 50,000 66,000 56,000 72,000 45,000 33,000 42,000 48,000 63,000 43,000 26,000 60,000 46,000 66,000 56,000 43,000 54,000 66,000 54,000 69,000 50,000 41,000 41,000 48,000 67,000 70,000 69,000 39,000 53,000 27,000 38,000 52,000 37,000 31,000 57,000 28,000 49,000 56,000 54,000 51,000 38,000 58,000 56,000 60,000 40,000 11,000 65,000 18,000 56,000 34,000 49,000 42,000 37,000 64,000 60,000 44,000 50,000 40,000 48,000 48,000 53,000 26,000 50,000 57,000 PictureClick here for the Excel Data File Let Sample 1 be the sample of the starting salary of college graduates in 2008 and Sample 2 be the sample of the starting salary of college graduates in 2010. a-1. Specify the competing hypotheses that determine whether the starting salary of college graduates has declined from 2008 to 2010. H0: ?1 ? ?2 = 0; HA: ?1 ? ?2 ? 0 H0: ?1 ? ?2 ? 0; HA: ?1 ? ?2 < 0 H0: ?1 ? ?2 ? 0; HA: ?1 ? ?2 > 0 a-2. Using the p-value approach, have salaries gone down from 2008 to 2010 at the 5% significance level? Reject H0; there is evidence that the starting salary of college graduates has declined from 2008 to 2010. Reject H0; there is no evidence that the starting salary of college graduates has declined from 2008 to 2010. Do not reject H0; there is evidence that the starting salary of college graduates has declined from 2008 to 2010. Do not reject H0; there is no evidence that the starting salary of college graduates has declined from 2008 to 2010.

Answer 1