CFA Practice Question

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CFA Practice Question

True or False? If 100 random samples of size n were drawn and a 99% confidence interval for MU was computed for each, exactly 99 of these confidence intervals would contain within their limits the true population mean.
Correct Answer: False

User Contributed Comments 10

User Comment
Shalva an explanation please
wulin key word is "exactly".
jmelville The question doesn't tell you the sample size so you can't assume normal distribution. It only tells you the number of samples not the size.
Mutsa sample size should be > 30 for it to app population mean. 100 is the number of samples, not sample size.
dealer80 dear all 100 is the sample size and as wulin said above the key word is exactly
dcfa 100 is not the sample size, 100 is the number of samples drawn - n is the sample size
geofin From the textbook:

"If samples of the same size are drawn repeatedly from a population and a 90% confidence interval is calculated from each sample, then 90% of these intervals should contain the population mean as the number of samples goes to infinity."

Since the number of samples in the question is only 100, then using "exactly" is incorrect.
johntan1979 The error is 99% confidence interval does not mean 99% x 100. That's all and that's it.
gill15 It means 99% of the samples would be within range not 99% of the CI's
stevo expected outcome that is not certain, thus "exactly" is inaccurate.
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