CFA Level I · CFA Level I Exam · Estimation and Hypothesis Testing
An analyst wants a sample of 200 stocks from a universe of 2,000 in which every stock has an equal chance of selection, so that the sample is free of selection preference. Which sampling method does this describe?
Simple random sampling describes the method, because every stock in the universe has an equal chance of being chosen. Judgmental and convenience sampling depend on the analyst's opinion or on easy access, which creates selection preference and a sample that may not be representative.
- ASimple random samplingCorrect
- BJudgmental sampling
- CConvenience sampling
Explanation
In simple random sampling each member of the population has the same probability of being selected. Judgmental sampling relies on the researcher's opinion, and convenience sampling uses easily accessible items, so both introduce selection preference.
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