- CFA Exams
- CFA Level I Exam
- Study Session 3. Quantitative Methods (2)
- Reading 10. Sampling and Estimation
- Subject 6. Confidence Intervals for the Population Mean
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. |