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Free CFA-Level-I Exam Braindumps (page: 193)

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PDF with 3963 Questions

Which of the following is/are true?

  1. There are as many values above the mean as below it.
    II. The sum of the differences between the observations in a sample and the mean of the sample equals zero.
    III. The mean is greatly affected by "outliers."
    IV. The mean is harder to estimate with reliability for open-ended data.
  2. I, II & III
  3. III only
  4. II & III
  5. II only
  6. I only
  7. IV only
  8. I & III
  9. II, III & IV

Answer(s): H

Explanation:

I would be correct if "mean" is replaced by "median" i.e. there are as many values above the median as below it. Note that one of the advantages of using the median instead of the mean is that the mean is greatly affected by outliers since it represents an average of all the observations while the median is not affected in this fashion.



What degree of relationship do values of the correlation coefficient (r) with magnitudes close to 1.00 indicate?

  1. Weak
  2. Strong
  3. Moderate
  4. None

Answer(s): B

Explanation:

The closer to 1, the stronger the relationship.



A researcher has a sample of 700 observations from a population whose standard deviation is known to be 1,235.6. The mean of the sample is calculated to be 219.2. The null hypothesis is stated as Ho: mean = 150 and the alternative is non-directional. The p-value in this case equals ________.

  1. 10.16%
  2. 13.88%
  3. 6.94%
  4. 12.82%

Answer(s): B

Explanation:

The z-statistic under the null equals (219.2 - 150)/(1235.6/(700^.5)) = 1.48. Since the alternative is non- directional, you must use a two-tailed test and ask the question, "What is the probability of observing a z- statistic at least as large in magnitude as 1.48?" The answer to this will give you the p- value for this sample under the two-tailed test. The right-tailed probability of observing a z-statistic which is at least as big as 1.48 equals 1.0 - 0.9306 = 0.0694 = 6.94%. The left-tailed probability of observing a z-statistic which is at least as small as - 1.48 also equals 6.94% since the standard normal distribution is symmetrical about zero. Therefore, the p-value of this two-tailed test in this sample equals 6.94%*2 = 13.88%.



In a sample of 2,000 persons, 1,600 favored more strict environmental protection measures. What is the estimated population proportion?

  1. 0.82 or 82%
  2. 0.20 or 20%
  3. 0.16 or 16%
  4. None of these answers
  5. 0.80 or 80%

Answer(s): E

Explanation:

Population proportion is given by 1600/2000 = 0.80






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