Free PRMIA 8002 Exam Dumps Questions & Answers

What is a Hessian?

• A.  The vector of partial derivatives of a contingent claim
• B.  A matrix of second derivatives of a function
• C.  The point at which a minimum of a multidimensional function is achieved
• D.  Correlation matrix of market indices

Suppose that f(x) and g(x,y) are functions. What is the partial derivative of f(g(x,y)) with respect to y?

• A.  f(dg/dy)
• B.  f'(g(x,y)) dg/dy
• C.  f'(g(x,y))
• D.  f(g(x,y)) dg/dy

Which of the following statements is true?

• A.  Discrete and continuous compounding produce the same results if the discount rate is positive.
• B.  The constant plays an important role in the mathematical description of continuous compounding.
• C.  Continuous compounding can be thought as making the compounding period infinitesimally small.
• D.  Continuous compounding is the better method because it results in higher present values compared to discrete compounding.

Consider the following distribution data for a random variable X: What is the mean and variance of X?

• A.  None of these
• B.  3.4 and 3.84
• C.  3.5 and 3.45
• D.  3.6 and 7.15

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

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