QM 292 Exаm #2 Summer 2021 Sаlаry and Tenure.dоcx In 2017 the Bureau оf Labоr Statistics (BLS), reported that annual overall industry employee turnover rates were 26.3%. Employee turnover is defined as employees who voluntarily quit, and the business replaces with a new hire. Employee turnover is very costly to a business. BLS estimates that the costs to replace an employee is one-half to two times an employee’s annual salary. One means that businesses use to reduce turnover is to offer employees a competitive salary. As an analyst for the BLS you are interested in predicting employee tenure. For 8 employees, you collect data on employee tenure and annual salary. The data, data definitions, and regression output are provided below. The level of significance is .05. Tenure with Company – length of employment with company as measured in years. Salary - thousands of dollars per year Answer the following questions: State the predicted linear regression line. Calculate the predicted tenure for an employee who earns $50K per year. Is the slope coefficient statistically significant? On what basis did you make your decision? What is marginal effect on employee tenure for each additional $10K in annual salary. Interpret the marginal effect. Is the overall model statistically significant? On what basis did you make your decision? If the level of significance were changed to .01, would your decision in #3 and #5 change? Why or why not?
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