CFA Practice Question

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CFA Practice Question

In estimating the population proportion for the days in summer that have thunderstorms, p, if the sample proportion, p', is 0.35 and the sample size is n = 92, the standard deviation of the sampling distribution is ______ (to nearest 0.001).

A. 0.650
B. 0.350
C. 0.050
Correct Answer: C

For a proportion the standard deviation of the sampling distribution, the distribution of the p's is shown at top right. Working with this formula, we get 0.050.

User Contributed Comments 7

User Comment
Pieter Where does this formula come from?
savita binomial distribution. The variance is p(1 - p).
StanleyMo excuse me, variance = P(1-p)/n under this situation.
apiccion Savita, variance of a binomial distribution is np(1-p). You're thinking of a Beroulli random variable.
cleopatraliao sampling distribution dealing with mean so we have to divide by n but not binomial, this is different. Just google the difference

pop mean, var = np, np(1-p)
sample mean, var = p, [p(1-p)]/n

Too easy to assume sample var is divided by only one n to become p(1-p) like the mean.
sgossett86 Without reading above... CFAs this was like the last question which i commented on. We saw that sd=(p(1-p))^.5 ... remember that we're finding the sd of the SAMPLING DISTRIBUTION, so we have to plug that into the standard error formula


that'll get you to the answer directly.
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