Question

You have been hired as a consultant for technology company. Create a study which would look into ways that would increase productivity for this company using a one-way ANOVA.

What is your IV?

What is your DV?

How many levels of your IV are there and what are they?

Answer 1

As a consultant for a technology company, your job is to maximize the firm's productivity. It is given that you need to use a one-way ANOVA to find out ways to increase the company's productivity.

Let us consider the worker's productivity in the firm. We will consider productivity as our dependent variable (DV).

Since we need to use a one-way ANOVA, we can consider salary to be our independent variable.

The independent variable (IV) can have, say n levels, based on the different categories of salaries received by the workers.

A one-way ANOVA is used to test whether the IV has any effect on the DV. ANOVA is also called Fisher's Analysis of Variance and is an extension of t-test or z test.

Here, each of the n levels of IV gets ni number of individuals who are randomly assigned to the treatments. Then we test whether the mean value of worker's productivity for each level of IV is the same for all levels or at least one is different. This test is done by Fisher's f statistic in one way ANOVA.

Test Statistic is:-

F= MST/MSE

MST is the Mean sum of squares due to treatments and MSE is the mean sum of squares due to errors.

(Here, n levels of IV can be, for example, four levels where the salary is grouped as <20000,20000-45000,45000-60000,60000 and above.)