Explain the effects of general cognitive ability on performance and commitment
What will be an ideal response?
Substantial research linking general cognitive ability to job performance exists. General cognitive ability is a strong predictor of job performance—in particular, the task performance aspect. Of all the variables, none has a stronger correlation with task performance than general cognitive ability. Thousands of organizations, many of which are quite well known, assess cognitive ability in efforts to select the best candidates available for specific jobs. The use of cognitive ability tests for this purpose appears to be quite reasonable, given that scores on such tests have a strong positive correlation with measures of performance across different types of jobs.
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Last year, XYZ Insurance Company had a combined ratio of 102.4 and lost $10.2 million on the insurance that it sold
The company, however, was required to pay income taxes. The best explanation for this apparent contradiction is that XYZ offset its underwriting loss with A) increased loss reserves. B) investment income. C) increased loss adjustment expenses. D) unearned premiums.
Which one of the following statements is correct concerning the weighted average cost of capital (WACC)?
A) The pre-tax rate of return on the debt is the rate that is relevant to the computation of the WACC. B) When computing the WACC, the weight assigned to the preferred stock is equal to the coupon rate multiplied by the par value assigned to the preferred stock. C) A firm's WACC will decrease as their corporate tax rate decreases. D) The weight of the common stock used in the computation of the WACC is based on the number of shares outstanding multiplied by the book value per share. E) The weight of the debt can be based on the face value of the bond issue(s) outstanding multiplied by the quoted price(s) when expressed as a percentage of the face value.