Median Starting Salary for Newly Hired MBAs
(US Companies), 2006-2015
Source: GMAC. Corporate Recruiters Survey, 2006-2015
Getting an MBA degree is expensive. Is the degree worth the money? To shed light on this question, a sample of 10 recent MBA graduates were surveyed and their salaries right before enrolling in an MBA program and their starting salary right after obtaining the degree were recorded. Assume that starting salaries follow a bell-shaped distribution. The following table summarizes the data. Let's agree that whenever σ is known we use Z and whenever σ is unknown we use t.
Name | Salary ($ '000) Before MBA | Salary ($ '000) After MBA
--- | --- | ---
Lisa | 55 | 95
James | 58 | 130
Meryl | 70 | 102
Yucan | 54 | 79
Raj | 81 | 125
Mihir | 49 | 90
Sai | 90 | 185
Shashikant | 67 | 85
Om | 55 | 220
Ami | 50 | 85
(Hint: Copy and paste this table into Excel.)
Formulate an appropriate hypothesis if your objective is to determine whether an MBA degree helps boost your salary.
1. What is the absolute value of the test statistic? (Round to 6 decimal places.)
2. What is the p-value? (Round to 6 decimal places.)
3. State your conclusions using α=5%: (Pick #1 or #2)
#1: Yes, we have sufficient evidence that having an MBA degree helps boost average salary.
#2: No, we don't have sufficient evidence that having an MBA degree helps boost average salary.