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PRMIA Exam 8010 Topic 2 Question 68 Discussion

Actual exam question for PRMIA's 8010 exam
Question #: 68
Topic #: 2
[All 8010 Questions]

Which of the following are valid approaches for extreme value analysis given a dataset:

1. The Block Maxima approach

2. Least squares approach

3. Maximum likelihood approach

4. Peak-over-thresholds approach

Show Suggested Answer Hide Answer
Suggested Answer: C

For EVT, we use the block maxima or the peaks-over-threshold methods. These provide us the data points that can be fitted to a GEV distribution.

Least squares and maximum likelihood are methods that are used for curve fitting, and they have a variety of applications across risk management.


by Felice at Mar 09, 2025, 02:13 PM

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Francene
12 days ago
The Peak-over-thresholds approach sounds like the most extreme way to analyze extreme values. I'm just picturing someone standing on a cliff, yelling 'PEAK!' every time a data point exceeds the threshold.
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Jonell
13 days ago
I can't believe they're including the Least squares approach as an option. That's like using a hammer to perform open-heart surgery!
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Stevie
15 days ago
All of the approaches listed seem like they could be valid for extreme value analysis. This question is really testing our understanding of the different techniques, not just memorization.
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Staci
4 days ago
User 1: I think the valid approaches for extreme value analysis are 1, 3, and 4.
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Lauran
23 days ago
Maximum likelihood is a standard technique for parameter estimation, so I'd expect it to be a valid approach for extreme value analysis. The question seems to be testing our knowledge of different statistical methods.
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Willodean
7 days ago
A) 2 and 3
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Nikita
29 days ago
I think the correct answer is D) All of the above because all the approaches mentioned can be used for extreme value analysis.
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Timothy
1 months ago
The Block Maxima approach and the Peak-over-thresholds approach seem to be the most relevant for extreme value analysis. I'm not sure why the Least squares approach would be considered valid here.
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Geraldine
7 days ago
Really? I didn't realize that. I thought it was just the Block Maxima and Peak-over-thresholds approaches.
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Felix
14 days ago
The Least squares approach is also valid for extreme value analysis.
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Luann
20 days ago
I agree, those two approaches are commonly used for extreme value analysis.
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Beckie
24 days ago
I think the Block Maxima approach and the Peak-over-thresholds approach are both valid.
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Karl
1 months ago
I believe the valid approaches are the Least squares approach and the Maximum likelihood approach.
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Valda
1 months ago
I think the valid approaches for extreme value analysis are the Block Maxima approach and the Peak-over-thresholds approach.
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