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Basic Question 11 of 14
An analyst is currently reviewing the following regression analysis:
B. Since the calculated t-statistic of 2.88 exceeds the critical t-statistic, the null hypothesis is rejected.
C. Since the calculated t-statistic of 6.88 falls within the critical t-statistic, the null hypothesis is accepted.

At a significance level of 5%, which of the following statements would best reflect the null hypothesis that coefficient of the first independent variable is equal to 1.0?
A. Since the calculated t-statistic exceeds the critical t-statistic of 1.68, the null hypothesis is rejected.
B. Since the calculated t-statistic of 2.88 exceeds the critical t-statistic, the null hypothesis is rejected.
C. Since the calculated t-statistic of 6.88 falls within the critical t-statistic, the null hypothesis is accepted.
User Contributed Comments 5
User | Comment |
---|---|
grewei | Wouldn't the critical t-statistic be between 2.000 and 2.021? The answer (B) is the same but I come up with a different critical t-statistic. |
noonah | Should not we use the F-statistic since it is a multiple regression? |
noonah | Oops, discard above comment. We can use the t-statistic since we are testing the significance of only one indep. variable, rather than ALL of them. |
aruffo | What formula is being used to calculate the t-test here? |
awbronson | @aruffo me thinks... {B(hat) - B)} / Stand Error of B(hat) .... pg 298 in print CFA curriculum |

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Edward Liu
Learning Outcome Statements
calculate and interpret measures of fit and formulate and evaluate tests off it and of regression coefficients in a simple linear regression
CFA® 2025 Level I Curriculum, Volume 1, Module 10.