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Basic Question 9 of 10
True or False? If False, explain why.
Testing at a 5% level of significance means that you only have a 5% chance of rejecting the null hypothesis.
User Contributed Comments 4
| User | Comment |
|---|---|
| bobert | Would an also acceptable answer be: False, Testing at a 5% level of significance means that you only have a 5% chance of failing to reject the null hypothesis. I think that is right, just want to make sure the wording is correct. Any disagreements? |
| mordja | Bobert its a 5% chance of type one error, ie failing to accept the null hypotheses if the hypothesis is true. failing to reject the null when it is false is type two error. |
| johntan1979 | Only if the null is true... otherwise, statement is incomplete and unacceptable. |
| robbiecow | Shouldn't it be: the sign level is the probability of WRONGLY rejecting the null hypothesis if it is in fact true... Comments? |
I am using your study notes and I know of at least 5 other friends of mine who used it and passed the exam last Dec. Keep up your great work!
Barnes
Learning Outcome Statements
explain hypothesis testing and its components, including statistical significance, Type I and Type II errors, and the power of a test
CFA® 2024 Level I Curriculum, Volume 1, Module 8.