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Basic Question 3 of 20
For x, a normal random variable with mean = 70 and standard deviation = 10, what x-score is 1.2 standard deviations below the mean?
B. 58
C. 68.8
A. 82
B. 58
C. 68.8
User Contributed Comments 6
| User | Comment |
|---|---|
| bentang | can someone explain the formula? |
| bobert | The highest point on the normal distribution is the mean, therefore the middle. 1 standard deviation is going to be +/- 10. The question asks for 1.2 standard deviations BELOW the mean. Because it is below we are going to be subtracting, and since 1 standard deviation = 10, 1.2 = 12. This leaves us with 70 - 12 = 58. |
| JKiro | 1st note: this is a normal distribution mean of 70 & std dev. of 10--> 1 std dev. (given) looking for value of x to result in 1.2 std dev (1.2/1)(10) = 12 is the resultant shift from the mean (positive or negative) given a 1.2 std dev. for negavite shift (below): x = 70 - 12 --> 58 for positive shift (above): x = 70 + 12 --> 82 the question asked for the value of x (from the mean) below: 58 |
| tschorsch | I think that the distribution is irrelevant for this question. 1.2 std devs below the mean should always be mean - 1.2 x stddev |
| peteSP | mean / 1.2 = 58 |
| 2014 | Pete what if they ask above 58 would be wrong |
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Learning Outcome Statements
calculate, interpret, and evaluate measures of dispersion to address an investment problem
CFA® 2024 Level I Curriculum, Volume 1, Module 3.