If a Test Is Going to Predict a Criterion Well

question 28

Multiple Choice

If a test is going to predict a criterion well, the correlation between the test and the criterion should be

• A) around .00 to indicate no errors of estimate.
• B) a large, positive coefficient of correlation.
• C) either a large positive or large negative correlation.
• D) a large, negative coefficient of correlation.

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Definitions:

Target Pricing

Target pricing is a pricing strategy where the selling price is determined by estimating a competitive price in the market and working backward to calculate costs, aiming for a certain profit margin.

Price Cutting

A strategy where a company reduces the prices of its goods or services, often to attract more customers or compete with rivals.

Product Class

A broad category of products that serve a similar function or are marketed in a similar manner but vary in features, quality, and price.

Product Line

A group of related products under a single brand offered by a company, catering to varied customer needs or preferences.