Deal of the Day! Hurry Up, Grab the Special Discount - Save 25% - Ends In 00:00:00 Coupon code: SAVE25
Welcome to Pass4Success

- Free Preparation Discussions

PRMIA Mathematical Foundations of Risk Measurement ? 2015 Edition Exam

Certification Provider: PRMIA
Exam Name: Mathematical Foundations of Risk Measurement ? 2015 Edition
Number of questions in our database: 132
Exam Version: Mar. 17, 2023
Mathematical Foundations of Risk Measurement ? 2015 Edition Exam Official Topics:
  • Topic 1: Single Topic

Free PRMIA Mathematical Foundations of Risk Measurement ? 2015 Edition Exam Actual Questions

The questions for Mathematical Foundations of Risk Measurement ? 2015 Edition were last updated On Mar. 17, 2023

Question #1

A 2-step binomial tree is used to value an American put option with strike 105, given that the underlying price is currently 100. At each step the underlying price can move up by 10 or down by 10 and the risk-neutral probability of an up move is 0.6. There are no dividends paid on the underlying and the continuously compounded risk free interest rate over each time step is 1%. What is the value of the option in this model?

Reveal Solution Hide Solution
Correct Answer: A

Question #2

In a 2-step binomial tree, at each step the underlying price can move up by a factor of u = 1.1 or down by a factor of d = 1/u. The continuously compounded risk free interest rate over each time step is 1% and there are no dividends paid on the underlying. Use the Cox, Ross, Rubinstein parameterization to find the risk neutral probability and hence find the value of a European put option with strike 102, given that the underlying price is currently 100.

Reveal Solution Hide Solution
Correct Answer: C

Question #3

The gradient of a function f(x, y, z) = x + y2 - x y z at the point x = y = z = 1 is

Reveal Solution Hide Solution
Correct Answer: D

Question #4

In a 2-step binomial tree, at each step the underlying price can move up by a factor of u = 1.1 or down by a factor of d = 1/u. The continuously compounded risk free interest rate over each time step is 1% and there are no dividends paid on the underlying. Use the Cox, Ross, Rubinstein parameterization to find the risk neutral probability and hence find the value of a European put option with strike 102, given that the underlying price is currently 100.

Reveal Solution Hide Solution
Correct Answer: C

Question #5

Which of the following can be used to evaluate a regression model?

(i) Magnitude of R2

(ii) Magnitude of TSS (total sum of squares)

(iii) Tests for statistical significance

(iv) Sign and magnitude of each regression parameter

Reveal Solution Hide Solution
Correct Answer: C


Unlock all Mathematical Foundations of Risk Measurement ? 2015 Edition Exam Questions with Advanced Practice Test Features:
  • Select Question Types you want
  • Set your Desired Pass Percentage
  • Allocate Time (Hours : Minutes)
  • Create Multiple Practice tests with Limited Questions
  • Customer Support
Get Full Access Now
Disscuss PRMIA Mathematical Foundations of Risk Measurement ? 2015 Edition Topics, Questions or Ask Anything Related

Save Cancel