You are in charge of the marketing department. Your company offers insurance products via online and telemarketing channels. You are trying to improve the effectiveness of your telemarketing employees by examining the hiring practices. Specifically, you are trying to answer two questions:

1. Should we offer referral bonuses to our current employees?

2. A third party offers cognitive and personality testing (Specifically measures of Conscientiousness). Should we use those tests in our hiring process?

In order to examine these questions, you have collected referral, testing results, and other background information for your last 423 hires. The data you collected:

Sales:Employee Sales during their first month of employment (in $thousand; so 30.00 is $30,000).

Referral:Was the employee referred by another sales representative (0= non-referral; 1= referral)?

Months_Previous:Number of months the employee spent in their previous position.

Year_Education:Total years of formal education calculated from resume information.

Communication:Result of assessment measuring applicant communication ability. This measure has been in place for years and a higher score it better.

Years_Sales:Number of years of previous sales experience.

Cons.: Assessment of Conscientiousness based on third party testing (Conscientiousness is a dimension of personality). This is one of the assessments you are considering for the hiring process going forward. A higher score is better.

Cognitive:Assessment of Cognitive/Problem Solving ability based on third party testing. This is one of the assessment you are considering for the hiring process going forward. A higher score is better.

Please use this information to answer the following questions.

Now build a multiple linear regression using Sales as the Y and Cognitive, Cons., Years_Sales, Communication, Year_Education, Months_Previous, Referral as predictors, manually make any adjustments to the model you deem necessary (do not use stepwise at this point) in order to build the most parsimonious model (use sig. level of .05). Please use your results to answer the following questions:

Year_Education and Cognitive are both statistically significant. (True / False)?

Each additional year of education increases expected sales by more than $4k holding all the other variables in the model constant. (True / False)?

The final model explains more than 50% of the variation in Current Sales. (True / False)?

The resulting model seems to have issues with non-constant variance. (True / False)?

All variables that had a positive correlation with Sales in the correlation matrix also have a positive slope estimate in this model. (True / False)?