Free PRMIA 8010 Exam Questions

Become PRMIA Certified with updated 8010 exam questions and correct answers

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Total 242 Questions | Updated On: Feb 18, 2025

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Question 1

Which of the following carry greater counterparty risk: a forward contract on a 10 year note, or a commercial paper carrying a AA credit rating with identicalmaturity and notional?

A : forward contract has greater credit risk as its future gains are unknown

B : edit risk can not be compared in these terms

C : ey both carry the same credit risk

D : commercial paper has greater credit risk as the entire notional is outstanding

Answer: D

Question 2

Which of the following statements are true:

I.Top down approaches help focus management attention on the frequency and severity of loss events, while

bottom up approaches do not.

II. Top down approaches rely upon high level data while bottom up approaches need firm specific risk data to

estimate risk.

III. Scenario analysis can help capture both qualitative and quantitative dimensions of operational risk.

A : I only

B : and III

C : only

D : only

Answer: B

Question 3

There are two bonds in a portfolio, each with a marketvalue of $50m. The probability of default of the two bonds over a one year horizon are 0.03 and 0.08 respectively. If the default correlation is zero, what is the one year expected loss on this portfolio?

A : $11m

B : $5.26m

C : $5.5m

D : $1.38m

Answer: C

Question 4

In respect of operational risk capital calculations, the Basel II accord recommends a confidence leveland time horizon of

A : 99.9% confidence level over a 10 day time horizon

B : 99% confidence level over a 10 year time horizon

C : 99% confidence level over a 1 year time horizon

D : 99.9% confidence level over a 1 year time horizon

Answer: D

Question 5

Which of the following decisions need to be made as part of laying down a system for calculating VaR:

I. The confidence level and horizon

II. Whether portfolio valuation is based upon a delta-gamma approximation or a full revaluation

III. Whether the VaR is to be disclosed in the quarterly financial statements

IV. Whether a 10 day VaR will be calculated based on 10-day return periods, or for 1-day and scaled to 10

days

A : and III

B : and IV

C : II and IV

D : l of the above

Answer: C

Page: 1 / 49

Total 242 Questions | Updated On: Feb 18, 2025

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