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Terms such as measurement, evaluation, and test are sometimes used as synonyms of the term assessment. Although these terms are related to assessment, their meanings and purpose are distinctly different. Measurement may be thought of as quantifying a performance or characteristic such as score on a test, height, or weight; evaluation denotes judgments about the quality or worth of something; and a test usually means a specific instrument (paper-and-pencil test) or set of procedures to measure knowledge, abilities, or other characteristics. Assessment is a general term that is used to encompass everything a teacher does to ascertain the level at which students have mastered the subject matter, can perform certain tasks, or exhibit certain behaviors.

Assessment includes the collection, analysis, and interpretation of various kinds of information useful for educational decisions. Leonard Carmichael and Bette Caldwell suggested that assessment can produce direct benefits to students, as teachers use both formal and informal assessments to diagnose students' strengths and weaknesses. Assessment can provide information that helps teachers to identify students who need additional instruction, special services, or more advanced work. Assessment also can serve as the basis for teacher reflections on their instructional effectiveness. Based on data collected though various kinds of assessments, teachers can make instructional decisions about re-teaching a lesson or unit or moving ahead with more challenging lessons. Results of assessments can provide feedback to students to indicate areas in which performance needs improvement and areas in which performance is satisfactory.

Early roots of educational assessment can be traced to the one-room schoolhouse where students moved forward to the next level when the teacher determined they had mastered the necessary knowledge and skills. Tests were administered to ascertain progress, with no letter grades (A, B, C, etc.) reported. Teachers reported student progress orally or through their written notes. The growth of schools necessitated that students be divided into different levels, and percentages were used to report student progress and to identify those who were prepared for college. Comparisons were made among students, and those earning the highest and lowest scores were assigned grades of A and F, respectively. Most of the student scores fell in the middle range and thus were assigned a grade of C for average. Student scores close to the top, but not the highest, were assigned a grade of B, and those falling below the average level were assigned a grade of D. However, in 1912, research by D. Starch and E. C. Elliott raised questions about the use of percentages as a basis for assigning letter grades and screening for college admission. Their research showed great discrepancies in the grades assigned by teachers. This apparent lack of consistency among teachers in grading spurred teachers to use grading scales such as Excellent, Average, or Poor.

In the early 1900s, standardized tests began to be used in the schools as an outgrowth of their use to screen men for the military. Standardized tests were based on national norms. Federal legislation—most notably Public Law (P.L.) 94–142, which mandates a free and appropriate public education for individuals between the ages of 3 and 21; the Individuals with Disabilities Education Act (IDEA), which amended P.L. 94–142; and the No Child Left Behind (NCLB) Act—has brought about increased interest in assessment at the local, state, and national levels.

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