PRMIA 8007 Exam Questions Instant Access - No Installation Required

Question 1

The determinant of a matrix X is equal 2. Which of the following statements is true?

Adet(2X) =

Bdet(2X) = 2 det(X)

Cdet(2X) = det(X)2

Ddet(2X) = 4 det(X)

Answer : D

Question 2

Two vectors are orthogonal when:

Aone is a scalar multiple of the other

Btheir components are linearly dependent

Ctheir determinant is zero

Dtheir scalar product (sum product) is zero

Answer : D

Question 3

Let A be a square matrix and denote its determinant by x. Then the determinant of A transposed is:

Ax -1

Cln(x)

D-x

Answer : B

Question 4

A 2-year bond has a yield of 5% and an annual coupon of 5%. What is the Macaulay Duration of the bond?

B1.95

C1.86

D1.75

Answer : B

Question 5

Consider an investment fund with the following annual return rates over 8 years: +6%, -6%, +12%, -12%, +3%, -3%, +9%, -9% .

What can you say about the annual geometric and arithmetic mean returns of this investment fund?

AThe arithmetic mean return is zero and the geometric mean return is negative

BThe arithmetic mean return is negative and the geometric mean return is zero

CThe arithmetic mean return is equal to the geometric mean return

DNone of the above

Answer : A

Question 6

Assume that 40% of all financial organizations investigated by authorities turn out to be fraudulent.

What is the probability of randomly investigating 2 different organizations and finding that neither is fraudulent; and what is the probability of finding exactly one being fraudulent?

A2/5 and 1/2

B2/5 and 3/5

C1/3 and 8/17

D9/25 and 12/25

Answer : D

Question 7

What is the probability of tossing a coin and getting exactly 2 heads out of 5 throws?

A8/15

B9/23

C10/32

DNone of these

Answer : C

PRMIA Mathematical Foundations of Risk Measurement â€“ 2015 Edition 8007 Exam Questions