Free GARP RAI Exam Questions

A trading firm uses reinforcement learning to determine the best time to buy or sell an asset. They have partial information about the state transitions and aim to maximize long-term profits by identifying the best action in each state. Which reinforcement learning approach is most suitable for this scenario?

A retail bank uses self-training to classify loan applicants as high or low risk, but it finds that updating the model after each new labeled data point is computationally intensive. Which approach can the bank use to reduce this burden?

An investment firm is setting up its model risk management framework. Who is primarily responsible for approving or rejecting models based on validation results?

A financial institution is creating a model inventory. Which of the following should be included to ensure comprehensive governance?

A data scientist is tuning the ridge regression model’s hyperparameter, λ, to control the trade-off between model fit and complexity. If λ is set too high, what effect is most likely?