CFA Practice Question

There are 434 practice questions for this study session.

CFA Practice Question

The main difference between the t and z statistic is that the t statistic ______.
A. is not normally distributed like the z statistic
B. is more variable than the z statistic
C. is less variable than the z statistic
Explanation:

User Contributed Comments 9

User Comment
andrewsutton Any special reason why "is not normally distributed like the z statistic" is not correct?
gweiden because both are normally distributed.
ehc0791 Not sure t-distribution can be called normal distribution. I saw a lot of case that z-distribution is called normal distribution.
micheleus the t-statistic is more conservative because the t-statistic tends to be greater than the z-statistic, and therefore usingt-statistic will result in a "wider confidence interval"----> ts is more variable than zs
kellyyang Yes Micheleus, you are right!
janis36 I thought t-distribution is not normal.
Marinov I thought the z-distribution is normal
milica818 the t-distribution and z-distribution are both normally distributed, but the t-distribution has fatter tails
edrei7 When the sample size gets large enough (i.e. >=30), both the t and z distributions will look approximately the same.
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