Level 1 CFA® Exam: Measures of Location (Computing Percentile)
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This blog post was created as a part of the CFA exam review series to help you in your level 1 exam revision, whether done regularly or shortly before your CFA exam.
Thanks to this short post, you get a useful piece of advice related to measures of location, recall an important formula, and take a practical tip.
Before computing any measure of location (like percentile, median, etc.), sort observations in ascending or a descending order.
Formula for the Location of a Percentile
- \(y\) – percentile,
- \(L_y\) – location of the percentile,
- \(n\) – number of observations.
Measures of Location: Practical Tip
If the location of the percentile is not an integer, we need to apply linear interpolation to compute this percentile. Have a look at the example.
There is a set of numbers given in ascending order: 2, 12, 23, 34, 45, 55, 65, 83, 87, and 89. Determine the value of the 20th percentile.
LAST UPDATE: 1 April 2022