Suppose the following table was generated from a sample of 20 CEOs relating annu
ID: 3357660 • Letter: S
Question
Suppose the following table was generated from a sample of 20 CEOs relating annual salary to years of experience and the industry in which they are employed. Indicator (dummy) variables were created for each industry (= 1 if the CEO works in that industry. 0 otherwise). The Health Care industry is considered the base-level industry. Coefficients Standard Error tStat P-Value Intercept 142706.036929 3778.760436 37.7653040.000000 Experience 2783.500659197.045769 14.126163 0.000000 Manufacturing 10796.216746 4492.643535 2.403088 0.029645 Financial-15625.820356 5111.657418 -3.056899 0.007990 Service20574.392643 4596.702352 4.475903 0.000444 Copy Data According to the results, if a CEO in the Health Care industry and a CEO in the Financial industry both have 5 years of experience, what is the estimated difference in annual salary between the two CEOs? Enter your answer below, rounded to two decimal places.Explanation / Answer
Since health care is a base level industry,
Difference between the annual salaries of Health care Industry CEO and Financial industry CEO
= 0 - Coefficient of Financial
= 0 - (-15625.82)
= 15625.82
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