PRMIA 8007 actual dump : Exam II: Mathematical Foundations of Risk Measurement - 2015 Edition

8007
  • Exam Code: 8007
  • Exam Name: Exam II: Mathematical Foundations of Risk Measurement - 2015 Edition
  • Updated: Sep 10, 2026
  • Q & A: 133 Questions and Answers

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PRMIA 8007 Exam Syllabus Topics:

SectionWeightObjectives
Topic 1: Linear Algebra and Matrix Theory20%- Matrix operations
  • 1. Determinants and trace
    • 2. Addition, multiplication, inversion
      - Vectors and eigenvalues
      • 1. Eigenvalues and eigenvectors
        • 2. Diagonalization
          Topic 2: Statistics and Regression Analysis20%- Linear regression
          • 1. Hypothesis testing and confidence intervals
            • 2. Simple and multiple regression
              - Descriptive statistics
              • 1. Measures of location and dispersion
                • 2. Correlation and covariance
                  Topic 3: Probability Theory25%- Random variables and distributions
                  • 1. Discrete and continuous distributions
                    • 2. Expected value, variance, covariance
                      - Basic probability concepts
                      • 1. Axioms and rules
                        • 2. Conditional probability and independence
                          Topic 4: Calculus and Functions20%- Single-variable calculus
                          • 1. Integrals and applications
                            • 2. Derivatives and applications
                              • 3. Limits and continuity
                                - Multivariable calculus
                                • 1. Optimization
                                  • 2. Partial derivatives
                                    Topic 5: Numerical Methods & Financial Mathematics15%- Root finding and approximation
                                    - Basics of risk modeling
                                    - Time value of money

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

                                    Question #1

                                    Which of the following properties is exhibited by multiplication, but not by addition?

                                    • A. distributivity
                                    • B. invertibility
                                    • C. associativity
                                    • D. commutativity
                                    Answer: A
                                    Question #2

                                    Which of the provided answers solves this system of equations?
                                    2y - 3x = 3y +x
                                    y2 + x2 = 68

                                    • A. x = 2; y = -8
                                    • B. x = 1; y = square root of 67
                                    • C. x = 2; y = 8
                                    • D. x = -2; y = -8
                                    Answer: A
                                    Question #3

                                    Which of the following is a false statement concerning the probability density function and the cumulative distribution function of a random variable?

                                    • A. the PDF is non-negative.
                                    • B. the CDF approaches 1 as its argument approaches infinity.
                                    • C. the definite integral of the PDF from minus infinity to plus infinity is zero.
                                    • D. the definite integral of the CDF from minus infinity to plus infinity is undefined.
                                    Answer: C
                                    Question #4

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

                                    • A. x
                                    • B. x -1
                                    • C. -x
                                    • D. ln(x)
                                    Answer: A
                                    Question #5

                                    An option has value 10 when the underlying price is 99 and value 9.5 when the underlying price is 101.
                                    Approximate the value of the option delta using a first order central finite difference.

                                    • A. -0.5
                                    • B. -4
                                    • C. 0.25
                                    • D. -0.25
                                    Answer: D

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