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The Love Bug that Lied

Who could be more trustworthy than Herbie, The Love Bug?  Remember those Disney movies from the 1970’s when the hero was a VW Beetle car, that always did the right thing?

Love Bug

What would Herbie have to say about VW actually designing, building, and installing a device in millions of cars that cheats on emissions testing?  It’s one thing to be disingenuous and mislead the public with false advertising and shaky statistics; but to carry out this deceit VW had to have a lot of employees on board for wholesale planned cheating.

I guess it is a good lesson for our students to learn that corporations will actually lie to us in order to make money.  When the first Love Bug movie came out in 1968 the tobacco industry was still vehemently denying that cigarettes cause lung cancer.  So some things never change, all the more reason for our students to sharpen their QR skills so they can ask intelligent questions of experts and have a voice in important public policy issues.

There were lots of articles to choose from on the VW scandal, and I was pleasantly surprised to find a Q-Reasoning error in the one I assigned my students, The VW Scandal Could Cost Car Owners $5,000.  In question #3 on the quiz below I walk my students through the argument and in part c ask if they can spot a problem with the reasoning.  Not one student got this right.  Probably they just assume that if it is published it must be correct.  See if you can find the flaw in the logic which was presented by a Professor in a school of business no less.

Q5 VW Scandal

Please type answers when possible and leave adequate space for computation work.

  1. The article, The VW Scandal Could Cost Car Owners $5,000, has lots of percent change mentioned which is like getting early Halloween candy for us.
    1. The market value of VW has “plunged almost $28 billion (about 30%)”. Using the 30% determine what the original market value was.
    2. Older engines emitted 500 parts per million of sulfur, while clean diesel is designed to emit “97% less sulfur emissions”. How many parts per million will clean diesel engines emit?
  1. What percentage of the clean diesel VW vehicles with the cheating emissions software were sold in the U.S.?
  2. The article states that “Volkswagen sold about 10 million vehicles in 2014” giving a revenue of $300 billion.
    1. How did they arrive at the $300 billion?
    2. The article then argues that “first tier suppliers” of VW have 80% of this figure at stake, $240 billion, and assuming the second tier suppliers have 80% of the first tier revenue, “the total impact could reach $432 billion”. How did they arrive at $432 billion?
    3. How can the total economic impact exceed the $300 billion that VW actually made? Do you agree with the argument that the total impact could reach $432 billion?
  1. Joel Best in DLS talks about how social problems are patterned. What does he mean by saying teenage runaways are patterned?
  2. Joel Best in DLS talks about the importance of measurement in creating statistics. Name one statistic he mentions and explain why measurement affects the statistic.
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