Fin 571

Week Four Learning Team D Assignment

Tiffani Clemens, Eric Dawson, Keith Hunt and Ashley Lawrence

QRB/501

July 28, 2014

Maryam Bolouri

Introduction

This paper is a collection of abstracts from the team members who participated in this learning team assignment. Each member selected a particular reference item from the University of Phoenix Library in order to explain standard deviation use in the business market. The reader will be informed of the individual research and support located by each of the team members.

Abstract #1, Ashley Lawrence

The purpose of applying the standard deviation formula within a business setting is to show how data can be spread either above or below the mean average (Cleaves, Hobbes & Noble, 2012). F.L. Schmidt developed a procedure for obtaining rational estimates of the standard deviation of job performance in dollars (SDy) (Burke, Frederick, 1984). The method is based on the reasoning that performance on the criterion in dollar terms is normally distributed, and then the difference between the value of the performance by the average employee and of an employee at the 85th or 15th percentile is equal to SDy (Burke, Frederick, 1984). This testing was performed on programmer productivity in the Federal Government and U.S. economy. Their results showed that the mean estimated SDy between computer programmers at the 85th and 50th percentiles was approximately equal to the difference between the 50th and 15th percentiles (Burke, Frederick, 1984).

There was another study conducted that involved 17 supervisors and insurance counselors which also supported Schmidt’s findings. This finding also suggests an unwanted covariance between percentile estimates. It was noted that individuals in the study were using different scales when giving percentile estimates. This happened to be noticed due to the drastic variances that exist within percentile points. A solution used to resolve this issue would be to remove the unwanted...