A business has two types of employees - managers and workers.  Managers earn either $100,000 or $200,000 a year.  Workers earn either $10,000 or $20,000 a year.  The number of male and female managers at each salary level are shown in the first table below.  The number of male and female workers at each salary level are shown in the second table below.  Managers   $100,000 $200,000 Male 80 20 Female 20 30Workers   $10,000 $20,000 Male 30 20 Female 20 80 These tables are converted to row percentages below: Managers   $100,000 $200,000 Male 80% 20% Female 40% 60%Workers   $10,000 $20,000 Male 60% 40% Female 20% 80% Looking at the data, females make more money than males, within both employee types.  For example, 60% of female managers are at the higher salary level, while only 20% of male managers are at this level.  Also, 80% of female workers are at the higher salary level, while only 40% of males are at this level.  When the data is broken down by employee type, females obtain higher salaries than males.  However, observe what happens when the data is put together.   There are 50 female managers and 100 female workers for a total of 150 females employed at this business.  The average female salary for the business can be computed by entering the following into RStudio: (20*100000+30*200000+20*10000+80*20000)/150 Compute the average male salary for this business.  Which of the following best describes the paradox that has been observed? Group of answer choices- (A) There is no paradox here!  The average male salary is lower than the average female salary, which follows the relationship that we observed when the data was broken down by subgroup.    (B) This is an example of Simpson's paradox because the direction of the relationship reverses when the data is broken down by subgroup.  Male employees make a higher average salary ($127,000.00) than female employees ($65,333.33).  However, when the data is broken down by employee type, a higher percentage of female managers are at the higher salary level than males.  The same holds true for the workers.  An explanation for this paradox is that there are more male managers than females and there are more female workers than males.  Since all managers make more money than workers, the average salary for males is higher than that of females.   (C) This is an example of Simpson's paradox because the direction of the relationship reverses when the data is broken down by subgroup.  Male employees make a higher average salary ($84,666.67) than female employees ($65,333.33).  However, when the data is broken down by employee type, a higher percentage of female managers are at the higher salary level than males.  The same holds true for the workers.  An explanation for this paradox is that females have historically been discriminated against in the workplace.  This shows that despite the fact that females make better managers than males, they still receive lower pay.   (D) This is an example of Simpson's paradox because the direction of the relationship reverses when the data is broken down by subgroup.  Male employees make a higher average salary ($84,666.67) than female employees ($65,333.33).  However, when the data is broken down by employee type, a higher percentage of female managers are at the higher salary level than males.  The same holds true for the workers.  An explanation for this paradox is that there are more male employees than female employees.  Since there are more males overall, there are more male managers, which makes their average salary higher than that of females.   (E) This is an example of Simpson's paradox because the direction of the relationship reverses when the data is broken down by subgroup.  Male employees make a higher average salary ($84,666.67) than female employees ($65,333.33).  However, when the data is broken down by employee type, a higher percentage of female managers are at the higher salary level than males.  The same holds true for the workers.  An explanation for this paradox is that there are more male managers than females and there are more female workers than males.  Since all managers make more money than workers, the average salary for males is higher than that of females.

MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
Problem 1P
icon
Related questions
Topic Video
Question

A business has two types of employees - managers and workers.  Managers earn either $100,000 or $200,000 a year.  Workers earn either $10,000 or $20,000 a year.  The number of male and female managers at each salary level are shown in the first table below.  The number of male and female workers at each salary level are shown in the second table below. 

Managers
  $100,000 $200,000
Male 80 20
Female 20 30
Workers
  $10,000 $20,000
Male 30 20
Female 20 80

These tables are converted to row percentages below:

Managers
  $100,000 $200,000
Male 80% 20%
Female 40% 60%
Workers
  $10,000 $20,000
Male 60% 40%
Female 20% 80%

Looking at the data, females make more money than males, within both employee types.  For example, 60% of female managers are at the higher salary level, while only 20% of male managers are at this level.  Also, 80% of female workers are at the higher salary level, while only 40% of males are at this level.  When the data is broken down by employee type, females obtain higher salaries than males.  However, observe what happens when the data is put together.  

There are 50 female managers and 100 female workers for a total of 150 females employed at this business.  The average female salary for the business can be computed by entering the following into RStudio:

(20*100000+30*200000+20*10000+80*20000)/150

Compute the average male salary for this business.  Which of the following best describes the paradox that has been observed?

Group of answer choices-
(A) There is no paradox here!  The average male salary is lower than the average female salary, which follows the relationship that we observed when the data was broken down by subgroup. 
 
(B) This is an example of Simpson's paradox because the direction of the relationship reverses when the data is broken down by subgroup.  Male employees make a higher average salary ($127,000.00) than female employees ($65,333.33).  However, when the data is broken down by employee type, a higher percentage of female managers are at the higher salary level than males.  The same holds true for the workers.  An explanation for this paradox is that there are more male managers than females and there are more female workers than males.  Since all managers make more money than workers, the average salary for males is higher than that of females.
 
(C) This is an example of Simpson's paradox because the direction of the relationship reverses when the data is broken down by subgroup.  Male employees make a higher average salary ($84,666.67) than female employees ($65,333.33).  However, when the data is broken down by employee type, a higher percentage of female managers are at the higher salary level than males.  The same holds true for the workers.  An explanation for this paradox is that females have historically been discriminated against in the workplace.  This shows that despite the fact that females make better managers than males, they still receive lower pay.
 
(D) This is an example of Simpson's paradox because the direction of the relationship reverses when the data is broken down by subgroup.  Male employees make a higher average salary ($84,666.67) than female employees ($65,333.33).  However, when the data is broken down by employee type, a higher percentage of female managers are at the higher salary level than males.  The same holds true for the workers.  An explanation for this paradox is that there are more male employees than female employees.  Since there are more males overall, there are more male managers, which makes their average salary higher than that of females.
 
(E) This is an example of Simpson's paradox because the direction of the relationship reverses when the data is broken down by subgroup.  Male employees make a higher average salary ($84,666.67) than female employees ($65,333.33).  However, when the data is broken down by employee type, a higher percentage of female managers are at the higher salary level than males.  The same holds true for the workers.  An explanation for this paradox is that there are more male managers than females and there are more female workers than males.  Since all managers make more money than workers, the average salary for males is higher than that of females.
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps

Blurred answer
Knowledge Booster
Optimization
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, statistics and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
Statistics
ISBN:
9781119256830
Author:
Amos Gilat
Publisher:
John Wiley & Sons Inc
Probability and Statistics for Engineering and th…
Probability and Statistics for Engineering and th…
Statistics
ISBN:
9781305251809
Author:
Jay L. Devore
Publisher:
Cengage Learning
Statistics for The Behavioral Sciences (MindTap C…
Statistics for The Behavioral Sciences (MindTap C…
Statistics
ISBN:
9781305504912
Author:
Frederick J Gravetter, Larry B. Wallnau
Publisher:
Cengage Learning
Elementary Statistics: Picturing the World (7th E…
Elementary Statistics: Picturing the World (7th E…
Statistics
ISBN:
9780134683416
Author:
Ron Larson, Betsy Farber
Publisher:
PEARSON
The Basic Practice of Statistics
The Basic Practice of Statistics
Statistics
ISBN:
9781319042578
Author:
David S. Moore, William I. Notz, Michael A. Fligner
Publisher:
W. H. Freeman
Introduction to the Practice of Statistics
Introduction to the Practice of Statistics
Statistics
ISBN:
9781319013387
Author:
David S. Moore, George P. McCabe, Bruce A. Craig
Publisher:
W. H. Freeman