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Basic Question 0 of 5
True or False? If false, correct the statement.
A confidence interval estimate for a parameter is used to eliminate the element of chance from estimation.
User Contributed Comments 4
| User | Comment |
|---|---|
| surob | Can someone explain what it means? Didn't quite understand. Thx |
| bobert | I think it means that the because it is an estimate, it is acknowledging that there is uncertainty or chance in the estimation. Analogy: A person robs a store that you are at. The police come to you for a statement and ask how confident you feel about picking the man out of a lineup. You say 95%. You are not saying that you are 100% sure because there is a chance that you won't be able to. |
| epizi | I think chance is about probability of the right guess.If you are given a reasonable range to choose, chance of missing(getting) the right guess is reduced(increased) |
| Shalva | You cannot eliminate uncertainty simply by calculating the confidence interval. |
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Learning Outcome Statements
explain how to standardize a random variable;
calculate and interpret probabilities using the standard normal distribution;
CFA® 2024 Level I Curriculum, Volume 1, Module 4.