Working Papers,
Örebro University, School of Business

Abstract: Given the presence of a cutoff score in a multiple-choice questions test, a challenge for the test maker is to choose a scoring method maximizing the probability of a passing score for those with adequate knowledge given a prescribed risk of passing those with insufficient understanding. Within the environment of a true-false choice test, we analyze the statistical power of the standard method - one point if the correct answer is marked and zero otherwise – with that of the negative marking method - no answer results in zero points, a correct answer generates one point, and an incorrect answer is penalized by one point. Our comparison of power between the two methods indicates that the power is about equal when test taker exhibits a small variance in terms of her degree of confidence across the questions. For larger variance, the negative marking method is superior to the standard method. However, the more the test taker fails to capture her level of confidence, i.e., mis-calibration of knowledge, the lower statistical power of the negative marking. Which method has the highest power depends on the magnitude of mis-calibration. Underrating does not affect the power of NM as much as overrating

Keywords: multiple-choice questions; negative marking; test of statistical power

JEL-codes: A22; C12

Language: English

22 pages, August 28, 2025

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