- CFA Exams
- CFA Exam: Level II 2021
- Study Session 3. Quantitative Methods (2)
- Reading 7. Machine Learning
- Subject 2. Overview of evaluating ML algorithm performance

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**CFA Practice Question**

Which error is irreducible?

B. variance error

C. base error

A. bias error

B. variance error

C. base error

Correct Answer: C

Base error is the variance due to chance. It is not reducible. The other 2 are reducible.

The variance is how much that the estimate varies around its average.

Bias and variance together gives us prediction error.

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