CFA® Level I question of the day
16 October 2026 · Quantitative Methods
Why does using a two-sample test on paired data waste information?
Show the answer and explanation
Answer: C. Because it ignores the pairing
Variation between subjects is left in the noise instead of being differenced out. The paired test is more powerful on the same data, which is the practical cost of choosing wrongly.
- A. Because it uses fewer degrees of freedom - It generally uses more, since it treats the observations as 2n independent values rather than n differences. More degrees of freedom here buy nothing.
- B. Because it requires a larger sample - It requires no more data than is already in hand. The cost is power on the data you have, not an additional data requirement.
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