The Primary Criterion for Item Selection in the Empirical Method

question 20

Multiple Choice

The primary criterion for item selection in the empirical method of test construction is determining whether the item

• A) makes the scale more reliable.
• B) is cross-validated between two known groups.
• C) loads highly on its primary factor.
• D) will be challenged in a legal context.

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Definitions:

Indicator

A measurement or signal that can be used to gauge certain financial conditions or market trends.

Put/Call Ratio

A technical indicator that measures the number of put options being traded relative to call options, often used to gauge market sentiment or investors' expectations about market direction.

Indicator

A statistic or metric used to gauge future trends in financial markets, economies or other financial entities.

Short Interest

A financial metric indicating the quantity of a company's shares that are currently sold short and have not yet been covered or closed out.