Question

Two competitive brothers, who work in two different industries, were comparing their salaries. Because there is a difference of 4 years in their respective work experience, they decided to compare, not their actual salaries, but to compare their salaries against their company averages to see who is doing better. The following gives the brothers salaries, companies mean, and standard deviation for each company

Brother Salary P sd
Tom 84000 75000 7000
Andy 70578 60000 8200
What is the 2-score of Andy's salary?
a. 1.89
b. 1.89
c. 1.29
d. 0-129

Answer 1

c. 1.29

Explanation:

Z-score:

In a set with mean
`\mu` and standard deviation
`\sigma`, the z-score of a measure X is given by:

`Z = (X - \mu)/(\sigma)`

The Z-score measures how many standard deviations the measure is from the mean. After finding the Z-score, we look at the z-score table and find the p-value associated with this z-score. This p-value is the probability that the value of the measure is smaller than X, that is, the percentile of X. Subtracting 1 by the p-value, we get the probability that the value of the measure is greater than X.

Andy 70578 60000 8200

This means that
`X = 70578, \mu = 60000, \sigma = 8200`

What is the z-score of Andy's salary?

This is Z, so:

`Z = (X - \mu)/(\sigma)`

`Z = (70578 - 60000)/(8200)`

`Z = 1.29`

So the correct answer is given by option c.