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8007 Exam Dumps - PRMIA PRM Certification Questions and Answers

Question # 14

You invest $100 000 for 3 years at a continuously compounded rate of 3%. At the end of 3 years, you redeem the investment. Taxes of 22% are applied at the time of redemption. What is your approximate after-tax profit from the investment, rounded to $10?

Options:

A.

$9420

B.

$7350

C.

$7230

D.

$7100

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Question # 15

What is the sum of the first 20 terms of this sequence: 3, 5, 9, 17, 33, 65,…?

Options:

A.

1 048 574

B.

1 048 595

C.

2 097 170

D.

2 097 172

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Question # 16

Concerning a standard normal distribution and a Student's t distribution (with more than four degrees of freedom), which of the following is true?

Options:

A.

The distributions have the same kurtosis.

B.

The normal distribution has higher kurtosis than the t distribution.

C.

The normal distribution has lower kurtosis than the t distribution.

D.

Which has the higher kurtosis depends on the degrees of freedom of the t distribution.

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Question # 17

What is the indefinite integral of the function f(x) = ln(x), where ln(x) denotes the natural logarithmic function?

Options:

A.

x ln(x) - x

B.

ln(x) - x

C.

1/x

D.

exp(x)

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Question # 18

Which of the following statements are true about Maximum Likelihood Estimation?

(i) MLE can be applied even if the error terms are not i.i.d. normal.

(ii) MLE involves integrating a likelihood function or a log-likelihood function.

(iii) MLE yields parameter estimates that are consistent.

Options:

A.

(i) and (ii)

B.

(i) only

C.

(i) and (iii)

D.

(i), (ii), and (iii)

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Question # 19

Which of the following statements is not correct?

Options:

A.

Every linear function is also a quadratic function.

B.

A function is defined by its domain together with its action.

C.

For finite and small domains, the action of a function may be specified by a list.

D.

A function is a rule that assigns to every value x at least one value of y.

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Question # 20

For each of the following functions, indicate whether its graph is concave or convex:

Y = 7x2 + 3x + 9

Y = 6 ln(3x)

Y = exp(-4x)

Options:

A.

concave, concave, concave

B.

concave, convex, convex

C.

convex, concave, concave

D.

convex, convex, concave

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Question # 21

If a random variable X has a normal distribution with mean zero and variance 4, approximately what proportion of realizations of X should lie between -4 and +4?

Options:

A.

66.60%

B.

90%

C.

95%

D.

99%

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Question # 22

Which of the provided answers solves this system of equations?

2y – 3x = 3y +x

y2 + x2 = 68

Options:

A.

x = 1; y = square root of 67

B.

x = 2; y = 8

C.

x = 2; y = -8

D.

x = -2; y = -8

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Exam Code: 8007
Exam Name: Exam II: Mathematical Foundations of Risk Measurement - 2015 Edition
Last Update: Feb 23, 2025
Questions: 132
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