- CFA Exams
- CFA Level I Exam
- Topic 1. Quantitative Methods
- Learning Module 8. Hypothesis Testing
- Subject 1. The Process of Hypothesis Testing
CFA Practice Question
The 95% confidence interval for the sample mean is -4.56 to 3.27. The null hypothesis is that the sample mean is equal to zero. The alternative hypothesis is that the sample mean is not equal to zero (two-tailed test). The null hypothesis most appropriately should be ______.
A. accepted at a 5.0% level of significance
B. rejected at a 5.0% level of significance
C. rejected at a 2.5% level of significance
Explanation: The 95% confidence interval contains the value zero. Thus, the null hypothesis cannot be rejected.
User Contributed Comments 2
| User | Comment |
|---|---|
| gradyf | I thought you should never "accept" the null hypothesis, only reject/fail to reject it? |
| hanswerner | I see it like gradfy, tests can be rejected or failed to rejected. |