You are part of a management development program and are rotating through all departments of the company to learn how each department works.The Vice President for Human Resources has assigned a project.You have been given a large employee payroll data set. It contains these variables:

Employee ID #

Sex:

• Male
• Female

Age in years

Current Annual Salary

Years of employment at this company

College Degree Category:

• None,
• Bachelors,
• Masters or above

Race Category per EEOC:

• White
• Black
• Native American
• Asian/Indian subcontinent
• Pacific Islander
• Two or more races

Ethnicity category:

• Hispanic
• NOT Hispanic

Supervisor status category:

• Supervisor or above,
• Not a supervisor

Your task is to use Regression analysis and propose a study to see if current annual salary is affected by education, race,ethnicity, sex, age and years of experience at the company.

Prepare for your meeting by writing out the following:

1. Briefly describe the steps you would take to transform the categorical variables into dummy variables.Be sure to give them new names to indicate that transformation.

2. List the steps of analysis you would use to examine the data before you ran the first regression.

3.Write an equation using variable namesfor the first regression model you would run with all the variables you would use toexamine this issue.Make sure to use the transformed variable names where needed. (Note: ascatterplotwithtrendlinedoes not count as running the first regression for purposes of this question.)

4. Explain how you would find the best model.