CFA CFA Level 1 Diff in means test

Diff in means test

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    • Avatar of pcunniffpcunniff
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        Can someone explain the answer better for this question? I am confused as to the “why” on this question. Said another way, what do they mean by “We just calculate the denominator (STD error) differently”?

        Which of the following assumptions is least likely required for the difference in means test based on two samples?

        A)

        The two samples are independent.

        B)

        The two populations are normally distributed.

        C)

        The two populations have equal variances.

        Explanation

        When the variances are assumed to be unequal, we just calculate the denominator (standard error) differently and use both sample variances to calculate the t-statistic. (LOS 11.h)

      • Avatar of jujubeadsjujubeads
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          I don’t think it means anything significant, just not a very clear explanation.

          To conduct a t-test, 4 requirements must be met:

          Data must be continuous (not discrete)Samples have to be independentData must approximate normal distributionNo outliers

          Differing variances would not be a problem for t tests – it’s just another variable in calculating the t-statistic.

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