To Study the Effects of Physical Discomfort on Attention, Dr

question 22

Essay

To study the effects of physical discomfort on attention, Dr. Lopez conducted the following study: A group of participants were required to keep one hand submerged in cold water (52 degrees). Half of the participants kept their hand in the water for 2 minutes, and half of the participants kept their hand in the water for 4 minutes. In addition, half of the participants were given a placebo pill and told it would reduce the pain of the water (pain relief assumed). The other half were given a placebo pill and told that it would have no effect (no pain relief assumed). While their hands were in the water, participants were asked to watch a video where a ball is quickly passed between and underneath three cups. At the end of the video, participants were asked to indicate under which cup the ball could be found. Whether or not the participant picked the correct cup was recorded (as a measure of whether they were paying attention). The results are below.

Using Dr. Lopez's study as an example, explain why an interaction can be described as "a difference in differences."

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Definitions:

Material Error

A significant mistake in financial reporting that could influence the economic decisions of users of the financial statements.

Prospective Adjustment

An accounting adjustment applied to transactions or valuation changes that occur in the current or future accounting periods.

Adjusting Events

Events after the balance sheet date that provide further evidence of conditions that existed at the end of the reporting period, requiring adjustments to financial statements.