CFA® Level 1: CFA® Level 1 Exam Question

CFA® Level 1: CFA® Level 1 Exam Question

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Question

Which of the following is/are true?

I. Multiplying every value in a distribution by 2 will double the sample variance.

II. Multiplying every value in a distribution by 2 will double the sample mean.

III. Adding a constant to every value in a distribution increase the sample variance by the square of the constant.

Answers

Explanations

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A. B. C. D. E.

Explanation

Multiplying every value in a distribution by 2 will double the sample mean and standard deviation and quadruples the variance. Adding a constant to every value in a distribution leaves the sample variance unchanged.