CFA Practice Question

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CFA Practice Question

Research shows that 72% of consumers have heard of MBI computers. A survey of 500 randomly selected consumers is to be conducted. What is the mean and standard deviation for the number of consumers that have heard of MBI computers?

A. 360; 10.04
B. 360; 100.80
C. 144; 100.80
Correct Answer: A

mean = 0.72 x 500 = 360
variance = 0.72 x (1 - 0.72) x 500 = 100.8
standard deviation = 100.81/2 = 10.04

User Contributed Comments 3

User Comment
TammTamm A seems like the only logical answer without doing the calculations. I wish all Quant was like this.
DonAnd I keep making the careless mistake of not taking the square root to get the s.d. woe'tis me. so naturally i selected B. ahhhh!!!!
endurance key here is determine the difference between Bernoulli and binomial to get variance/stddev correct.
Either the consumer know or don't know about MBI computers -> binomial -> variance = np(1-p) -> stddev = (np(1-p))^0,5
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