Free Practice PRMIA 8010 Exam Questions 2025

Stay ahead with 100% Free Operational Risk Manager (ORM) 8010 Dumps Practice Questions

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Total 242 Questions | Updated On: Apr 11, 2025

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Question 1

Whichof the following statements are true in relation to Historical Simulation VaR?

I. Historical Simulation VaR assumes returns are normally distributed but have fat tails

II. It uses full revaluation, as opposed to delta or delta-gamma approximations

III. Acorrelation matrix is constructed using historical scenarios

IV. It particularly suits new products that may not have a long time series of historical data available

A : II

B : II and III

C : I and IV

D : All of the above

E : A

Answer: A

Question 2

Under the KMV Moody's approach to calculating expectingdefault frequencies (EDF), firms' default on obligations is likely when:

A : expected asset values one year hence are below total liabilities

B : asset values reach a level below short term debt

C : asset values reach a level below totalliabilities

D : asset values reach a level between short term debt and total liabilities

Answer: D

Question 3

Under the internal ratings based approach for risk weighted assets, for which of the following parameters must each institution make internal estimates (as opposed to relying upon values determined by a national supervisor):

A : Probability of default

B : Effective maturity

C : Loss given default

D : Exposure at default

Answer: A

Question 4

The risk that a counterparty fails to deliver its obligation upon settlement while having received the leg owed

to it is called:

A : Pre-settlement risk

B : Credit risk

C : Replacement risk

D : Settlement risk

Answer: D

Question 5

The Options Theoretic approach to calculating economic capital considers the value of capital as being equivalent to a call option with a strike price equal to:

A : The notional value ofthe debt

B : The market value of the debt

C : The value of the firm

D : The value of the assets

Answer: A

Page: 1 / 49

Total 242 Questions | Updated On: Apr 11, 2025

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