TABLE 12-4
One Criterion Used to Evaluate Employees

question 108

Multiple Choice

TABLE 12-4
One criterion used to evaluate employees in the assembly section of a large factory is the number of defective pieces per 1,000 parts produced. The quality control department wants to find out whether there is a relationship between years of experience and defect rate. Since the job is repetitious, after the initial training period any improvement due to a learning effect might be offset by a loss of motivation. A defect rate is calculated for each worker in a yearly evaluation. The results for 100 workers are given in the table below.
$$\begin{array}{l}\text {\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad Years Since Training Period }\\\begin{array} { r | r r c } &< 1 \text { Year } & 1 - 4 \text { Years } & 5 \text { - 9Years } \\\hline \text { High } & 6 & 9 & 9 \\\text { Defect Rate: Average } & 9 & 19 & 23 \\\text { Low } & 7 & 8 & 10\end{array}\end{array}$$

-Referring to Table 12-4, of the cell for 1 to 4 years of training time and a high defect rate, what is the contribution to the overall ?² statistic for the independence test?

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Definitions:

Profit-Maximizing Rule

A principle stating that profit maximization occurs when a firm's marginal cost equals its marginal revenue.

Perfectly Competitive

Describes a market structure where many firms sell identical products, there are no barriers to entry or exit, and all firms are price takers.

Excess Capacity

A situation where a firm is producing at a lower scale of output than it has been designed for, leading to inefficiencies.

Average Total Costs

The total costs of production divided by the number of units produced, representing the cost per unit.