Critical thinking: Lurking Variables

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Quiz. 7.

Critical thinking: Lurking Variables Over the past few years, there has been a strong positive correlation between the annual consumption of diet soda drinks and the number of traffic accidents.

Do you think increasing consumption of diet soda drinks causes traffic accidents? Explain.

No; soda is a soft drink which does not cause any type of mental malfunctioning or drunkenness that is likely to cause a driver to lose control or cause traffic accident in any way. In addition to that, there has been no indication that the chemical components of soda cause blindness or blurred vision over long-term usage (Brase & Brase, 2011). In addition to that, the research studies following traffic accident increase have not in any way linked its causes to soda consumption. Therefore, the two variables cannot be said that are lurking variables.

What lurking variables might be causing the increase in one or both of the variables? Explain.

The lurking variables that cause the increase in both of them are different and not linked in any way. The lurking variable that is causing the increase in soda consumption is the low cost of soda and reduction of alcohol consumption. Soda is a soft drink whose price has remained unchanged for a long time as other the price of other soft drinks increase therefore; there has been an increase in preference of soda to other drinks due to the price level. This is one lurking variable that has led to the increase in soda consumption over few years that have past (Brase & Brase, 2011). The second likely lurking variable that has led to the increase in soda consumption is the fact that most people have realized the negative effects of hard drinks such as alcoholic drinks and therefore, they are shifting from consuming alcoholic drinks into drinking soda which is a soft and dietary drink that goes at a lower cost and has no negative effects to the consumer.

The lurking variable that has led to the increase in the rate of traffic accidents over few years that have past is the ignorance of drivers to traffic rules and regulation. The first traffic rule in any given country is that in order for any individual to drive in public, that person must have a driving license. This driving license is only given to an individual on confirming through test after training that that particular individual is aware of all the traffic signs and rules and is able to operate within their requirement. Most people have hid a deaf ear to this and this is the first reason why over the past few years, the traffic accidents have increased. Secondly, the traffic rule provides that any individual should only drive when sober and not when under the influence of any drug. Therefore, it can be concluded that the two variables above; the increase in soda consumption and the increase in traffic accidents are not in any way related.

Quiz. 8.

Critical thinking: Lurking Variables Over the past decades, there has been a strong positive correlation between teacher salaries and prescription drug costs.

Do you think paying teachers more causes prescription drugs to cost more? Explain.

No; Teachers are in no way linked to the drug production and therefore, it would be out of sense for one to insinuate that paying teachers higher salaries causes an increase in the cost of drugs over the past few decades. The rise in the salaries of the teachers is caused by the rise in the general economic state of the globe. On the other hand, the rise in the global economy is the same reason that has led to the increase in the rise in the prices of drugs over the past few decades.

What lurking variables might be causing the increase in one or both of the variables? Explain.

The lurking variable that has caused the increase in both the teachers’ pay and the cost of drugs is the rise in the general global economy. The teachers teach as a career and job and therefore, their earning has to be worthy enabling them to live a life that is worthy a class of people who integrate knowledge in the society (Brase & Brase, 2011). The rise in the economic state has led to the rise in the general prices of both primary and secondary needs which they have to acquire for survival. Therefore, their pays have to be raised in order for them to be able to buy those basic and secondary needs.

On the other hand, the prices of drugs have increased because of the very same reason of rise on the global economy. The cost of the raw materials that are used in the production of drugs have increased in price due to the rice in the general global economy as well as the payment of the medical employees which results in the increased input in the drug production. The firms that deal in drug production are profit oriented and therefore, would in turn increase the prices of the drugs in order to get reasonable returns on capital invested. Therefore, it can be concluded that the two variables are no linked directly in that one has caused an increase of another but they are affected by a similar or single lurking variable which is rise in the global economy.

Quiz. 14.

Health Insurance: Administrative Cost

The following diagram provides a representation of the relationship between administrative cost against the number of employees within a health insurance plan.

The correlation between the average administrative cost and the number of employees as indicated in the diagram can be said to be moderate; with the administrative cost reducing as the number of employees within an insurance health plan increases. The mode of correlation can be termed to be inversely proportional though not in a linear way and this is a negative correlation (Brase & Brase, 2011).

The statistical computations of the tabulated figures from excel are as follows;

x y xy x^2 y^2

3 40 120 9 1600

7 35 245 49 1225

15 30 450 225 900

35 25 875 1225 625

75 18 1350 5625 324

Σ135 148 3040 7133 4674

The computations are accurate as they are in line with the automated calculations in the excel spreadsheets as indicated above. The value of r is 0.77 and it indicates that as the values move from 3 to 75, the value of Y ought to decrease due to the economies of scale associated with minimizing costs for registering or covering a pool of many employees within the health insurance plan.

Quiz. 17.

The diagram below shows a scatter diagram showing the correlation between batting average and home run percentage.

The correlation is positive and high as the scatter dots are aligned close to the trend line or the line of best fit. This has an implication that there is a positive correlation s the line is positively sloping (upwards).

The value of the figures is accurate as indicated from the computations and the value of r is 0.948 meaning that the two variables under consideration are highly correlated.

References:

Brase, C and Brase, C (2011). Understanding Basic Statistics, 6th ed. Cengage Learning.