The Correlation Between Employee IQ and Productivity in a Factory

question 6

Multiple Choice

The correlation between employee IQ and productivity in a factory is .12 with a significance of p < .01. What can we conclude?

• A) That there is a substantial relationship between IQ and productivity.
• B) That there is a small relationship between IQ an productivity.
• C) That IQ causes productivity.
• D) All of the above

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Definitions:

External Cost

An external cost, or negative externality, refers to a cost that a transaction or activity imposes on parties who are not involved in the transaction, such as pollution affecting non-participants.

Positive Externality

A benefit that affects someone who did not choose to incur that benefit, often leading to an under-provision of a good or service.

Vaccination

A medical intervention that introduces a substance to stimulate the body's immune response against disease.

Producer Surplus

The discrepancy between what sellers are prepared to take for a product or service and the actual payment they get in the marketplace.