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

1. An indefinite integral of a polynomial function is

A) always positive
B) always increasing
C) none of the above
D) always less than the function itself

2. Newton-Raphson iteration is used to find a solution of x5 - x3 + x = 1. If xn = 2, what is xn+1?

A) 1.623
B) 0.377
C) 1.638
D) 2.362

3. In statistical hypothesis tests, 'Type I error' refers to the situation in which...

A) Both null hypothesis and alternative hypothesis are rejected
B) The null hypothesis is rejected when in fact it should have been accepted
C) Both null hypothesis and alternative hypothesis are accepted
D) The null hypothesis is accepted when in fact it should have been rejected

4. A typical leptokurtotic distribution can be described as a distribution that is relative to a normal distribution

A) flat and thick at the center and with thin tails
B) peaked and thin at the center and with thin tails
C) flat and thick at the center and with heavy (fat) tails
D) peaked and thin at the center and with heavy (fat) tails

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

Solutions: