Determine the expected signs of the various coefficients

Reference no: EM1376380

(Y (sub (i)))= B (sub 0) + B(sub 1) X(sub i) + B(sub 2) D(sub2i) + B(sub 3) D(sub 3i) + u(sub i)

where:
Y= annual earnings of MBA graduates
X= years of service
D(sub 2)= 1 if Harvard MBA
=0 otherwise
D(sub3)= 1 Wharton MBA
= 0 otherwise

a. What are the expected signs of the various coefficients?why?
b. How would you interpret B(sub 2) and B(sub 3)? why?
c. If B(sub 2) > B(sub3), what conclusion would you draw and why?

Reference no: EM1376380

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