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ANOVA Significance Level: Four Different Majors on Salaries

Do graduates of undergraduate business programs with different majors tend to earn disparate average starting salalries? Consider the data in the attached file.

a. Is there any reason to doubt the equal variance assumption made in the one-way ANOVA model in this particular case? Support your response to this question.

b. Assuming the variances of the four underlying populations are indeed equal, can you reject at the 10% significance level that the mean starting salary is the same for each of the given business majors? Explain.

Comparing the Impact of Four Different Majors on Starting Salaries

Accounting Marketing Finance Management
$31,450 $28,350 $29,325 $27,320
$35,650 $27,845 $29,550 $26,450
$32,630 $28,430 $31,640 $30,135
$37,110 $27,645 $32,760 $27,340
$29,440 $28,635 $30,550 $28,635
$37,330 * $29,875 *
$30,835 * $28,890 *
* * $31,650 *

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Solution Preview

Please see the attached file.

There does not seem to be any major difference in the variances of the four disciplines.
Hypotheses: H0: m1 = m2 = m3 = m4 vs. HA: At least one of the means is different
Level of Significance: a = 10%
Decision Rule: Reject the null hypothesis if p-value < 0.10
One factor ANOVA
Mean n Std. Dev
33,492.1 7 3,185.08 ...

Solution Summary

This solution provides a null and alternative hypothesis on the differences of majors and their starting salaries. Test statistics are calculated and compared with a p-value to make a decision to accept or reject the null hypothesis on the relationship. All steps are shown in an Excel file.