Explain regression discontinuity with an example
Last updated: February 14, 2026
Quick Overview
Explain regression discontinuity in simple terms and provide a concrete example.
Compass
February 14, 202611
5
4,238 solved
Explain regression discontinuity in simple terms and provide a concrete example.
Statistics questions at Compass test your ability to reason quantitatively and design rigorous experiments. This Technical Screen question evaluates your understanding of statistical inference and its application to business decisions.
What the Interviewer Expects
- Set up the problem formally with proper notation
- Apply the correct statistical test with clear justification
- Interpret results with appropriate caveats and confidence levels
- Discuss practical significance vs statistical significance
- Identify potential confounders and how to address them
Key Topics to Cover
How to Approach This
- Define your hypotheses (H0 and H1) clearly before performing any test.
- Calculate required sample size BEFORE running an experiment, using power analysis.
- Remember the Central Limit Theorem: sample means become approximately normal with large n.
- Watch for Simpson's paradox. Always segment data by key dimensions.
- Distinguish between statistical significance and practical significance.
Possible Follow-up Questions
- How would you explain this result to a non-technical audience?
- What alternative statistical method could you use here?
- How would you design a follow-up experiment based on these results?
- What if the sample size is very small?
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