If the question provides you with a significae level of, let’s say 10%, how do you know when to look this value up in the z-table and when to use the 1.65 value as your critical value?
Is it that when the test is one-tailed, you are to look up the critical value using the sig. level in the z-table and if the question is two-tailed test, you can use the critical value 1.65?
Thanks for clarifying this for me!
Well, critical values come from standardised tables.This is true for one and two tailed tests. You look up this value if it is not given in the question and you are directed to a table to find the value. Be very careful when answering these questions because 95 % confidence level means something else for one tailed and two tailed tests:
the value you look up in the tables for a two tailed test would be +/- 1.96, while the value for the one tailed test would be 1.651.
So when answering these questions you need to ask yourself some questions:
1.One tailed vs two tailed?
2.Confidence interval?
3.Z-tests vs t-test?
Look for previous forum posts to see what others have done
http://www.analystforum.com/forums/cfa-forums/cfa-level-i-forum/9762295
http://www.analystforum.com/forums/cfa-forums/cfa-level-i-forum/91053820
happy exams
You’re amazing! Thanks!!