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PRMIA 8007 Exam Syllabus Topics:

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

1. What is the maximum value for f(x)= 8-(x+3)(x-3)?

A) -1
B) 17
C) None of these
D) 8

2. Let f(x) = c for x in [0,4] and 0 for other values of x.
What is the value of the constant c that makes f(x) a probability density function; and what if f(x) = cx for x in
[0,4]?

A) 1/7 and 1/9
B) None of the above
C) 1/4 and 1/6
D) 1/4 and 1/7

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

4. Which of the following can induce a 'multicollinearity' problem in a regression model?

A) The omission of a relevant explanatory variable
B) A high positive correlation between the dependent variable and one of the explanatory variables
C) A high positive correlation between two explanatory variables
D) A large negative correlation between the dependent variable and one of the explanatory variables

5. The natural logarithm of x is:

A) the inverse function of exp(x)
B) 46
C) always greater than x, for x>0
D) log(e)

Solutions: