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PRMIA 8007 Exam Syllabus Topics:

PRMIA Exam II: Mathematical Foundations of Risk Measurement - 2015 Edition Sample Questions:

1. A 95% confidence interval for a parameter estimate can be interpreted as follows:

A) The probability that the estimated value of the parameter is outside this interval is 95%.
B) The probability that the real value of the parameter is within this interval is 95%.
C) The probability that the estimated value of the parameter is within this interval is 95%.
D) The probability that the real value of the parameter is outside this interval is 95%.

2. Which of the following statements about variance and standard deviation are correct?
1. When calculated based on a sample of the population data, one has to correct for any bias in the result by using the number of degrees of freedom in the calculation
2. Variance is in square root units of the underlying data, whereas standard deviation is in units of the underlying data
3. When considering independent variables, variance is additive, while standard deviation is not

A) Statements 1 and 2 are correct
B) Statements 1 and 3 are correct
C) Statements 2 and 3 are correct
D) All three statements are correct

3. What is the 40th term in the following series: 4, 14, 30, 52, ...?

A) 240
B) 4960
C) 4598
D) 4840

4. Find the roots, if they exist in the real numbers, of the quadratic equation

A) 1 and 0
B) 4 and -2
C) No real roots
D) -4 and 2

5. Let N(.) denote the cumulative distribution function of the standard normal probability distribution, and N' its derivative. Which of the following is false?

A) N'(x) 0 as x
B) N'(0) 0
C) N(x) 0 as x
D) N(0) = 0.5

Solutions: