Page 53 - FINAL CFA SLIDES DECEMBER 2018 DAY 4

Session Unit 3:

12. Hypothesis Testing

LOS 12.j: : Identify the appropriate TS and interpret the results for a HT concerning 1) the variance of a

NDP, and 2) the equality of the variances of 2 NDPs based on 2 independent random samples, p300

2TT (F) 1TT (F)

F equals 1 when variances are equal; Always put the larger variance in the numerator..

Note that n1 – 1 and n2 – 1 are the dfs used to identify the appropriate critical value from the F-table