Highly recommended reading: a recent article in the New York times regarding the correlation between intelligence and grades. By all means check it out.
It seems that some students are rewarded with good grades based on compliance, such as in turning work in on time, writing legibly, sitting in front of the class, etc. However, come test time, these students sometimes falter.
In contrast, students that are less compliant and perhaps only earn average grades seem to perform better on tests. Interesting stuff.
But don't take my word for it. Read it right here.
Some major questions arise as to grading procedure, student performance and the future of education in this country.