PRMIA 8007 Exam Questions Free Practice Test

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Questions # 31:

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

Options:

The probability that the real value of the parameter is within this interval is 95%.

The probability that the real value of the parameter is outside this interval is 95%.

The probability that the estimated value of the parameter is within this interval is 95%.

The probability that the estimated value of the parameter is outside this interval is 95%.

Expert Solution

Questions # 32:

For a quadratic equation, which of the following is FALSE?

Options:

If the discriminant is negative, there are no real solutions

If the discriminant is zero, there is only one solution

If the discriminant is negative there are two different real solutions

If the discriminant is positive there are two different real solutions

Expert Solution

Questions # 33:

Let a, b and c be real numbers. Which of the following statements is true?

Options:

The commutativity of multiplication is defined by

The existence of negatives is defined by

The distributivity of multiplication is defined by

The associativity of multiplication is defined by

Expert Solution

Questions # 34:

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

Options:

8/15

9/23

10/32

None of these

Expert Solution

Questions # 35:

Solve the simultaneous linear equations: x + 2y - 2 = 0 and y - 3x = 8

Options:

x = 1, y = 0.5

x = -2, y = 2

x = 2, y = 0

None of the above

Expert Solution

Questions # 36:

You are given the following regressions of the first difference of the log of a commodity price on the lagged price and of the first difference of the log return on the lagged log return. Each regression is based on 100 data points and figures in square brackets denote the estimated standard errors of the coefficient estimates:

Which of the following hypotheses can be accepted based on these regressions at the 5% confidence level (corresponding to a critical value of the Dickey Fuller test statistic of – 2.89)?

Options:

The commodity prices are stationary

The commodity returns are stationary

The commodity returns are integrated of order 1

None of the above

Expert Solution

Questions # 37:

For each of the following functions, indicate whether its graph is concave or convex:

Y = 7x2 + 3x + 9

Y = 6 ln(3x)

Y = exp(-4x)

Options:

concave, concave, concave

concave, convex, convex

convex, concave, concave

convex, convex, concave

Expert Solution

Questions # 38:

For the function f(x) =3x-x3 which of the following is true?

Options:

x = 0 is a minimum

x = -3 is a maximum

x = 2 is a maximum

None of these

Expert Solution

Questions # 39:

Consider the linear regression model for the returns of stock A and the returns of stock B. Stock A is 50% more volatile than stock B. Which of the following statements is TRUE?

Options:

The stocks must be positively correlated ( )

Beta must be positive ( )

Beta must be greater in absolute value than the correlation of the stocks ( )

Alpha must be positive ( )

Expert Solution

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