CFA Practice Question

There are 410 practice questions for this study session.

CFA Practice Question

Listed below are two data sets, S and T. Which data set has the larger standard deviation? (Hint: You can answer this question by inspecting the two data sets. If you are not sure after inspection, calculate the standard deviation.)

Data Set S: 1, 2, 3, 4, 5, 6, 7, 8, 9
Data Set T: 8, 9, 9, 9, 10, 11, 11, 12
Correct Answer: Data Set S

On inspection, data set S has the larger sample standard deviation. By calculation: S(S) = 2.58, S(T) = 1.27

User Contributed Comments 9

User Comment
Lucho If it is a sample, you should use N instead of N-1 to calculate variance. It it is a population, then you should use N.
namie good question. I guess it is a population variance that's why it uses only N, instead of N-1. In this question we are not trying the sample the data buy actually trying the calculate the sd directly.
rfvo Here, i'll make it easy for ya....check the range
dravinskis Agree with rfvo.
AUAU I think no need to calculate.
Just observe the deviation from mean.
long2012 The sample standard deviation of S is 2.74 and population of standard deviation is 2.58.
chipster for once I answered correctly on just gut
tichas though it needs calculation but the range is a good indicator as well
cfastudypl Besides the range providing a good quick indication that data set S has a greater variability, if you look at the figures in data set T, you will see that there are repeated figures of the same values i.e 9 thrice and 11 twice indicating more constant values compare to data set S that has no repeated value and therefore is more volatile and hence the increased standard deviation.
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