CFA Practice Question

There are 434 practice questions for this study session.

CFA Practice Question

A hypothesis test is constructed at the 5% level of significance where the population standard deviation is unknown. A random sample of size n = 18 yields a sample mean of 67 and a sample standard deviation of 6. The critical value for H0: μ < 65 is ______.

A. -1.740
B. -1.645
C. 1.740
Correct Answer: C

Because the population standard deviation, σ, is unknown, we use a t-distribution: t(0.05, 18 - 1). Looking in the t-table under df = 17 and under column 0.05, we get 1.740. The rejection region is to the top 5%, so the critical value is 1.740.

User Contributed Comments 1

User Comment
irapp92 This would be a good test q.. no need to include a table as we should be able to conclude that the test stat is positive and there is only 1 positive answer
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