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Why not just run many t-tests? ANOVA and multiple comparisons

You have kk groups (say returns under kk different signals) and want to know whether their means differ.

Why is running every pairwise t-test a mistake, and what should you do instead?

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Each test has its own chance of a false positive. What happens to the combined chance when you run many of them?

Your answer

This one is open-ended. Work it through, then check your reasoning against the full solution.

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