SUMMARY OUTPUT

Regression Statistics
Multiple R 0.411637229
R Square 0.169445208
Adjusted R Square 0.159390065
Standard Error 0.193846454
Observations 419

ANOVA
df SS MS F Significance F
Regression 5 3.166115666 0.633223133 16.85159645 3.63969E-15
Residual 413 15.51907292 0.037576448
Total 418 18.68518858

Coefficients Standard Error t Stat P-value Lower 95% Upper 95%

Intercept 1.139086527 0.023993132 47.47552448 2.2516E-169 1.091922638 1.186250416
1st Educ - Bachelors -0.003709367 0.00073149 -5.070971983 5.98854E-07 -0.005147276 -0.002271459
2nd Educ - Masters -0.000279095 0.000941089 -0.296566259 0.766946755 -0.002129017 0.001570826
1st CompositeSkill - Decision making -0.002877548 0.00091693 -3.138242633 0.001821524 -0.004679979 -0.001075117
2nd Composite Skill - Communication 0.00188833 0.000731974 2.579777665 0.010231027 0.000449471 0.003327189
3rd Composite Skill - Human Resource Management -8.13915E-05 0.000639005 -0.127372358 0.898707686 -0.001337499 0.001174716

From the above table the value of R2 is 0.1694, which means that 16.94 % of the total variation in the
ratio of State average salary and Private average salary which is accounted by the total variation in
bachelors, masters, decision making, communication and human resource management.

Y is the dependent variable.

Y is the ratio of state government average and private average salary.

The regression equation is:

Y = a + b1X1 + b2 X2 + b3X3 + b4X4 + b5X5

X1 and X2 are the educational variables, X3 , X4 , and X5 are the composite skill variables.

The equation for the above model is written as :-

State average salary / Private average salary = 1.13908 – 0,0037 * bachelors – 0.000279 * masters –
0.00287 * 1st composite skill + 0.001888 * 2nd composite skill – 8.1391*10 -05 * 3rd composite skill.

F-Stat and Significance F:–

Null hypothesis states all the regression co-efficient of the independent variables is equal to
zero. b1=b2=b3=b4=b5=0, alternative hypothesis is not equal to zero b1=b2=b3=b4=b5≠0.The
F-Stat value is 16.8515 and its corresponding F-significance is 3.63969E-15. The F-stat value is
greater and F significance is less than level of significance α that is 0.05 so we accept the
alternative hypothesis at 5% level of significance that not all co-efficient are equal to zero.

1ST Educational variable – BACHELORS

𝐻0:B1=0

𝐻1:B1≠0

The t-stat value for bachelors is -5.0709 which is greater than -2, and the p-value is 5.9885E-07 which
is very less compared to the level of significance α which is 0.05 hence we say that it is statistically
significant. Therefore, null hypothesis for bachelors is rejected, Which means the value of bachelors is
not equal to zero.

2nd Educational variable- MASTERS

𝐻0:B2=0

𝐻1:B2≠0

The t-stat value for masters is -0.2965 which is closer to 0 and p value is 0.7669 which is greater
compared to the level of significance α that is 0.05 hence we can say that it is statistically
insignificant, Therefore, null hypothesis for masters is accepted, which means the value of masters is
equal to zero.

1ST Composite skill – DECISION MAKING

𝐻0:B3=0

𝐻1:B3≠0

The t-stat value for decision making is -3.1382 which is greater than -2, and p value is 0.00182 which
is lesser compared to the level of significance α that is 0.05 hence we can say that it is statistically
significant. Therefore, nul hypothesis for decision making is rejected, which means value of decision
making is not equal to zero.

2nd Composite skill – COMMUNICATION

𝐻0:B4=0

𝐻1:B4≠0

The t-stat value for communication is 2.5797 which is greater than 2, and p value is 0.0102 which is
lesser compared to level of significance α that is 0.05 hence we can say that it is statistically
significant. Therefore, null hypothesis for communication is rejected, which means value of
communication skill is not equal to zero.
3rd Composite skill – HUMAN RESOURCE MANAGEMENT

𝐻0:B5=0

𝐻1:B5≠0

The t-stat value for human resource management is -0.1273 which is closer to 0, and p value is 0.8987
which is greater than level of significance α that is 0.05 hence we can say that it is statistically
insignificant. Therefore, null hypothesis for human resource management is accepted, which means
value of human resource management is is equal to zero.

Overall fitness of the model

The regression summary output shows that the model has R2 value of 0.16944, this means that the
model explains only 16.94% change in the independent variable. From the table we know that
standard error is 0.1938.