Finding F-Statistic

CFA Level II
#1

Why are there to different formula’s for finding F-statistic?

  1. F = (RSS/k)/(SEE/(n-(K+1))

  2. F = (RSS/1)/(SEE/(n-2))

#2

I think the latter formula is only applied to single regressions. To be safe, i would always just use the former.

#3

Yup. k = 1; one slope coefficient, one independent variable.

At least that way you have to memorize only one formula, not two. Saves some brain space.

#4

both formulas are same. its basically

F = (RSS/ no. of independent variables)/SSE (total number of observations - total number of parameters)

when we are using one independent variable it takes the form F = (RSS/1)/(SSE/(n-2)

when we are using more than one independet variables it takes the form F = (RSS/k)/(SSE/(n-(k+1))

also their is a difference between SSE (sum of squared error) and SEE (standard error of estimate). In this formula we are using SSE not SEE.