3 Choices, not 4

Has anyone noted this on the CFA website!!!: Format Change For 2009 CFA Exams CFA Institute is committed to maintaining and improving the standards and consistency of the CFA exams. Research and our own experience indicate that the fourth answer option on multiple choice and item set exams is unnecessary to assess a candidate’s knowledge and skills. Three answer choices are sufficient and effective in discriminating between those candidates that possess the knowledge and skills and those that do not. As a result, we are changing the format of the multiple-choice and item set questions on CFA exams from four answer options to three. This change will be effective on the 2009 CFA exams. Read the FAQs. If you read the FAQ, the Institute says, basically, that the fourth choice in the item set questions was generally so implausible that most people never got fooled – so, the Institute is junking the fourth question and going with only three multiple choice answers. Interesting. Further, the Institute denies that the reduced number of choices will improve the “lucky guesses” that might otherwise sneak an unqualified candidate into the Charter. Although statistically, with 3 instead of 4 questions, this might seem to be the case, the Institute states that lucky guesses won’t carry a candidate through the whole test (an “infinitessimal chance of passing”). However, I would argue that a lucky guess or two just might be enough to move the score across the line – that’s where these new odds might be significantly helpful.

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This is stupid. 3 questions instead of 4 gives the appearance of an easier exam. This dilutes the value of the charter. BOOOOOOOOOOOOOOOOOO

Can someone tell me one positive effect of this change from the CFA Institute perspective?? I just don’t understand why they would change.

For those that have no idea, Auburn is a university in the state of Alabama. That should explain it all.

The chances of guessing a right answer are higher at 0.333 instead of 0.25 And then what about the time we spent reading the “stupid” 4th answer. Boloks

Mukaranga Wrote: ------------------------------------------------------- > The chances of guessing a right answer are higher > at 0.333 instead of 0.25 Good thing this CFA thing is all about the chances. I’ve been practicing with the coin lately, not going to start serious preparation until Dec.

If passing rates are the same, then who cares?

I’m sorry but this is just assinine. 1 out of 4 means you have a 25% chance of blindly guessing. 1 out of 3 means you have a 33% chance of blindly guessing. Since 33% is more than 25% the CFAI is wrong. Perhaps more importantly…THREE guesses??? I mean are they nuts. They should make it SIX guesses, in Hebrew via interprative dance using bottled air. THAT will make these exams harder. Willy

I don’t think that 3 choices instead of 4 choices will diminish CFA value for 2 reasons. 1. 3 choices may lead to better prediction but at the same time CFA institute will increase MPS and therefore the pass rate will decline. 2. The options available for the correct answer can be confusing. For example: Question: SML and CML are same… 1. No this is not correct 2. Yes this is correct. 3. SML can be CML only when… 4. SML and CML… 5… Pick the right option: a. Only 3,4,5 is correct. b. Only 1, 2, 3 is correct c. Only 3,4 is correct but 5 can be agreed only under xxx condition.

“This is stupid. 3 questions instead of 4 gives the appearance of an easier exam. This dilutes the value of the charter. BOOOOOOOOOOOOOOOOOO” I don’t buy this. Anywho says “Cfa? But that’s only a multi choice paper with three choices!” will soon shut the hell up when challenged to pass the damn papers. Anyway, although the chance of guessing a particular question is indeed 33% as opposed to 25%, the chance of guessing correctly enough times to hit 100% on a 120 question paper is, erm, something raised to the power of -58. That’s a big number.

or. should I say, a very long but tiny number!

so your point is …

I can see that 3 vs 4 may not have a huge effect on pass rates, but it does contribute to the perception that the exam is easier. Maybe that means more failures at L1, b/c more people underestimate the exam. So in support of the perception of hard exams: low pass rates. Supporting the perception of easy exams: 3 choice multiple choice questions. Someone who doesn’t know the exam, I suspect, is going to latch on to the 3-answer format before seriously looking at the pass rates. If there were a lot of exams that were 3-choice exams, that would be one thing, but 4- and 5- choice exams are much more common. By going to 3- choice, CFAI is already setting itself as an outlier on that score.

Perception is reality. If the exam is perceived to be easier, then it loses value. Additionally, having to guess out of 3 chances may allow someone the opportunity to snag a couple of extra points and crack the MPS. Either way, doesn’t really matter that much to me. I’m done with this CFA bullshit. I have the charter and will now go get an MBA that will make the CFA next to my name pale in comparison.

All about $$$$.

They should just make it true or false and raise the MPS to 95%.

They claim hardly anybody picks the 3rd distractor anyway, and therefore this will have little affect on the MPS and IMO no affect on the pass rate.

Will not change pass rate except at the margin. Assume you can get 50% only. Random guessing on second half has expected value of 12 1/2 % with 4 choices, 16 2/3% with 3 choices. So you’re at 66 2/3 instead of 62 1/2%. And they bump up the pass rate a bit to compensate. Ain’t going to be any easier. And that’s a super simple example.