PRMIA Exam 8002 Topic 3 Question 85 Discussion

Actual exam question for PRMIA's 8002 exam

Question #: 85
Topic #: 3

[All 8002 Questions]

Which of the following is consistent with the definition of a Type I error?

AThe probability of a Type I error is 100% minus the significance level

BA Type I error would have occurred if the performance of a stock was positively correlated with the performance of a hedge fund, but in a linear regression, the hypothesis of positive correlation was rejected

CA Type I error would have occurred if the performance of a stock was positively correlated with the performance of a hedge fund, but in a linear regression, the hypothesis of no correlation was rejected

DA Type I occurs whenever data series are serially correlated

Show Suggested Answer

Suggested Answer: C

by Wynell at Jul 12, 2024, 04:11 PM

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Iola

8 months ago

Wait, isn't the estimated mean divided by the estimated standard deviation supposed to have a normal distribution? I'm so confused right now.

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Bernardine

8 months ago

No, it actually has a Chi2-distribution.

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Carissa

8 months ago

The estimated mean divided by the estimated standard deviation has a t-distribution.

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Teddy

9 months ago

I agree with Bette, I also think the answer is A.

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Thomasena

9 months ago

Haha, I bet the exam writer is having a field day coming up with these trick questions. Jokes on us, the students!

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Ling

9 months ago

I'm not sure, but I think it might be D.

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Reta

9 months ago

Really? I was sure it was the estimated mean divided by the estimated variance that has a t-distribution. This exam is testing my knowledge of statistical distributions!

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Mica

8 months ago

Laila: Oh, I see. Thanks for clarifying!

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Thad

8 months ago

I believe the estimated mean divided by the estimated variance has a Chi2-distribution.

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Laila

8 months ago

No, actually it's the estimated mean divided by the estimated standard deviation that has a t-distribution.

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Ashlyn

8 months ago

I think it's the estimated mean divided by the estimated variance that has a t-distribution.

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Alverta

9 months ago

I disagree, I believe the answer is C.

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Bronwyn

9 months ago

Hmm, this question is a bit tricky. I think the answer is C, since the estimated mean divided by the estimated standard deviation should follow a t-distribution.

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