QUESTION 5 Alia Al Ketbi, one of the employees that got terminated, was awarded
ID: 380081 • Letter: Q
Question
QUESTION 5
Alia Al Ketbi, one of the employees that got terminated, was awarded a severance of AED 60,000. She has been working with the company for 9 years, received a monthly salary of AED 12,000, and had a total of 3 absences in her record.
Q5. Use the regression model to determine if her severance package was fair.
Table 2: Multiple Linear Regression: Summary Output
Coefficients
Intercept
-0.43
Employee Absences
-3.23
Length of Service
0.25
Monthly Salary
7.45
Table 2: Multiple Linear Regression: Summary Output
Coefficients
Intercept
-0.43
Employee Absences
-3.23
Length of Service
0.25
Monthly Salary
7.45
Explanation / Answer
Using regression equation, estimated severage package = -0.43 - 3.23*3 + 0.25*9 + 7.45*12000
= 89,392
She should have received a severance package of 89392,
but she received only 60000, which is less than what she should have received.
Therefore, here severage package was not fair.