Question

A faculty group wants to determine whether job rating​ (x) is a useful linear predictor of raise left parenthesis y right parenthesis . ​Consequently, the group considered the​ straight-line regression model ​E(y)equalsbeta 0plusbeta 1x. Using the method of least​ squares, the faculty group obtained the following prediction equation. Interpret the estimated​ y-intercept of the line. y with caret=14,000-​2,000x.

A. For an administrator who receives a rating of​ zero, we estimate his or her raise to be​ $14,000.

B. For a​ 1-point increase in an​ administrator's rating, we estimate the​ administrator's raise to increase​ $14,000.

C. The base administrator raise at State University is​ $14,000.

D. There is no practical​ interpretation, since rating of 0 is nonsensical and outside the range of the sample data.

Answer 1

We have given regression equation is,

y intercept = 14,000

Option A) is correct.

A. For an administrator who receives a rating of​ zero, we estimate his or her raise to be​ $14,000.