CFA Practice Question

There are 985 practice questions for this topic.

CFA Practice Question

A 95% confidence interval for a population parameter signifies which of the following?

I. 95% of similarly constructed intervals will contain the population parameter.
II. For a given sample size, 95% of the samples that have the sample statistic for the population parameter lie within the specified confidence interval around the actual population parameter.
III. The confidence interval will correctly estimate the population parameter with a probability of 95%.
A. I and II
B. II and III
C. I, II and III
Explanation: Note that III is incorrect because the confidence interval is a range estimate and hence cannot represent a point estimate of the population parameter itself.

User Contributed Comments 2

User Comment
Anevasee Damn question
ecapocas That's....well.

That's wrong for all practical intents and purposes.. You can estimate a point estimate within a range. For example if you say that the temperate will be between 70* and 75*F tomorrow, you just did exactly that. That's entirely the point of the whole exercise. It's entirely a trick of wording.
You need to log in first to add your comment.