CFA Practice Question

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CFA Practice Question

For a random sample of size n = 100 from a population with s = 8, the error term, E, for a 90% confidence interval is ______ (to nearest 0.01).

A. 0.05
B. 1.32
C. 10
Correct Answer: B

For a 90% confidence interval, we find z(0.05), the cutoff for the top 5% of the normal distribution. Looking up 0.95 in the middle of the table, the reading to the row/column values, we get 1.645. Working with the formula for E, we get E = 1.32.

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