120PM14A - 1. The following is a list of starting median...

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Unformatted text preview: 1. The following is a list of starting median salaries for college graduates by profession: Degree Starting Median Salary Education 36,200 Horticulture 37,200 Music 34,000 Social Work 33,400 Theology 34,800 (a) What is the average starting salary across the college degrees listed? This is just (36 , 200 + 37 , 200 + 34 , 000 + 33 , 400 + 34 , 800) / 5 = 35 , 120. (b) What is the median starting salary among the college degrees listed? Ordering the data from smaller to larger, we get : { 33 , 400 , 34 , 000 , 34 , 800 , 36 , 200 , 37 , 200 } . The median is the smallest number whose percentile is still larger than 50 th . Here the answer is the middle observation: 34 , 800. (c) Suppose that to the above list you add the starting salary for Economics majors, which is 50,200. What is the average then? How about the median? The average is now (36 , 200 + 37 , 200 + 34 , 000 + 33 , 400 + 34 , 800 + 50 , 200) / 6 = 37 , 633, while the median is still given by 34 , 800. Any number who is the 50 th percentile (not necessarily the smallest such number) is also an acceptable answer. In this case, any number greater than or equal to 34 , 800 but strictly smaller than 36 , 200. (d) Compare your answer to (c) with what you found in (a) and (b). Does adding the starting salary for Economics majors affect the mean and the median in the same way? Which one is more affected by adding this new observation? Why? Justify your answer. They mean changes by more than the median. This is an accordance to the mean being more sensitive to changes in the tails of the distribution than the mean....
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This note was uploaded on 12/05/2010 for the course ECON 120A taught by Professor M.abajian during the Spring '10 term at San Diego.

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120PM14A - 1. The following is a list of starting median...

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