In general, selection tests lead to the greatest gain when

Question

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Selection tests are most helpful when there is a large variation in performance among workers, as they allow employers to identify the individuals who are most likely to perform well. When performance does not vary greatly from worker to worker (as in A), the tests may not be as useful. When superior workers produce goods of greater value than average workers (as in C), the tests may still be useful but for a different purpose - to identify workers who have the potential to produce superior goods. The base rate (as in D, which refers to the prevalence of a certain characteristic in a population) is not directly related to the utility of selection tests.

In General, Selection Tests Lead to the Greatest Gain When