Asked by Gerson Hernandez on Jul 01, 2024

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Confidence intervals should be used with caution with time-series data because ________.

A) it's difficult to keep track of the time for each sample
B) measuring the variance of time-series data is not possible
C) the mean and/or variance of time-series data are not stationary
D) it's difficult to measure the mean and/or variance of time-series data

Confidence Intervals

A range of values derived from a dataset, estimated to contain the true value of a parameter with a certain probability level.

Time-Series Data

Data collected at successive equally spaced points in time, often used in forecasting and identifying trends.

  • Understand the influence of confidence level on the breadth of confidence intervals.
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Verified Answer

AN
Abdullah NaeemJul 07, 2024
Final Answer :
C
Explanation :
Time-series data often have changing mean and/or variance over time, which violates the assumption of independence required for confidence intervals. This means that the confidence interval may not accurately represent the true variability of the data, leading to incorrect inferences. Therefore, caution should be taken when interpreting confidence intervals with time-series data.