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Texas is home to more than one million undocumented immigrants and most of them are stuck in

low-paying jobs. Meanwhile, the state also suffers from a lack of skilled workers. The Texas
Workforce Commission estimates that 133,000 jobs are currently unfilled, many because
employers cannot find qualified applicants (The Boston Globe, September 29, 2011). Texas was
the first state to pass a law that allows children of undocumented immigrants to pay in-state
college tuition rates if they have lived in Texas for three years and plan to become permanent
residents. The law passed easily back in 2001 because most legislators believed that producing
college graduates and keeping them in Texas benefits the business community. In addition, since
college graduates earn more money, they also provide the state with more revenue. Carol
Capaldo wishes to estimate the mean hourly wage of workers with various levels of education.
She collects a sample of the hourly wages of 30 Texas workers with a bachelors degree or
higher, 30 Texas workers with only a high school diploma, and 30 Texas workers who did not
finish high school.
A portion of the data is shown in the accompanying table; the complete data set, labeled
Texas_Wages, can be found on the text website.

.:.
In a report, use the above information to:
1. Use descriptive statistics to compare the hourly wages of the three education levels.
2. Construct and interpret 95% confidence intervals for the mean hourly wage at each education
level.

SOLUTION:

Using Excel, we obtain the following relevant results:

Bachelor's Degree High School Diploma No High School Diploma


Mean 22.9596 Mean 12.2610 Mean 10.4607
Standard Standard Standard
Deviation 3.56262 Deviation 3.55175 Deviation 2.36902
Confidence Confidence Confidence
Level(95.0%) 1.330302 Level(95.0%) 1.326247 Level(95.0%) 0.88461

1. The average hourly wage for a Texas worker with a bachelors degree or higher is $22.96.
The average hourly wage for a Texas worker with and without a high school diploma is
$12.26 and $10.46, respectively. Texas workers with a bachelors degree or higher earn
approximately twice as much per hour than those workers with at most a high school
education. The variability in the hourly wage for Texas workers with a bachelors degree
or higher and those with a high school diploma seems comparable (in absolute terms)
with standard deviations of $3.56 and $3.55, respectively. The variability in the hourly
wage is less for those workers without a high school diploma with a standard deviation of
$2.37.

2. The 95% confidence interval for the mean hourly wage of Texas workers with a

bachelors degree or more is .


The 95% confidence interval for the mean hourly wage of Texas workers with a high

school diploma is .
The 95% confidence interval for the mean hourly wage of Texas workers without a high

school diploma is .