SCENARIO 11-9 Psychologists Have Found That People Are Generally Reluctant to Transmit

question 64

Multiple Choice

SCENARIO 11-9
Psychologists have found that people are generally reluctant to transmit bad news to their peers.This
phenomenon has been termed the "MUM effect." To investigate the cause of the MUM effect, 40
undergraduates at Duke University participated in an experiment.Each subject was asked to
administer an IQ test to another student and then provide the test taker with his or her percentile
score.Unknown to the subject, the test taker was a bogus student who was working with the
researchers.The experimenters manipulated two factors: subject visibility and success of test taker,
each at two levels.Subject visibility was either visible or not visible to the test taker.Success of the
test taker was either top 20% or bottom 20%.Ten subjects were randomly assigned to each of the 2
x 2 = 4 experimental conditions, then the time (in seconds) between the end of the test and the
delivery of the percentile score from the subject to the test taker was measured.(This variable is
called the latency to feedback.) The data were subjected to appropriate analyses with the following
results.
-Referring to Scenario 11-9, at the 0.01 level, what conclusions can you reach from the
Analysis?

• A) At the 0.01 level, subject visibility and test taker success are significant predictors of latency feedback.
• B) At the 0.01 level, the model is not useful for predicting latency to feedback.
• C) At the 0.01 level, there is evidence to indicate that subject visibility and test taker success interact.
• D) At the 0.01 level, there is no evidence of interaction between subject visibility and test taker success.

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Definitions:

Short-Term Debt

Loans or borrowings that are due for repayment within a short timeframe, typically within one year, used for immediate financing needs.

Retained Earnings

The portion of net income not distributed as dividends to shareholders, but retained by the company for reinvestment.

MACRS 3-Year Class

A category under the Modified Accelerated Cost Recovery System (MACRS) for depreciating certain types of business property over three years.

Amortized

Amortization is the process of spreading out a loan into a series of fixed payments over time, covering both principal and interest.