CFA Practice Question

There are 434 practice questions for this study session.

CFA Practice Question

Which one of the following statements is correct?
A. If, for a sample of 100 students from the registrar's office, it was found that 95% of students had dean's list averages, random sampling from the entire student body could not possibly have been performed.
B. Assuming the population variance is known, if the sample size is doubled, the variance of the distribution of the sample mean of a variable would be halved.
C. If L and U are the lower and upper limits of a 99% confidence interval for μ, then μ varies between L and U with a probability of 0.99.

User Contributed Comments 9

User Comment
haarlemmer I guess it is not to be halved, but quartered. This is a square relationship with the sample size. Someone gives me a hand to answer it, please!
johnsk sample variance = s^2/N. N is doubled so the variance is halved.
danlan Mu should not vary, it is constant.
dimanyc johnsk is absolutely correct
ElenaStep Can you please explain why C is wrong?Thanks!
Profache C is wrong because in a 99% confidence interval there are 99% chances that the mean is a value in that interval. It is incorrect to say that the mean will vary among values in a interval.
jpducros Sorry I still don't get it. sample variance = s^2/N ??
Shaan23 JPDuscros.

If sample variance = S^2 /n at the beginning(Eg. say n=10 ----> S^2 / 10
Now you double n ---> 20 .... Then variance = S^2 / 20
So when you double n your variance is halved
Hungerford C is incorrect because a 99% CI just means that, you are 99% confident that the true value lies within that interval.

The value doesn't actually have to VARY within the interval.
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