Preview Questions Actuary | Role Specific Skill

Question 1: Which method is typically used to assess the risk of extreme events in actuarial modeling?

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Extreme value theory (EVT)

Generalized Linear Model (GLM)

Bayesian statistics

Survival analysis

Question 2: When calculating the liabilities of a defined benefit pension plan, which assumption is most critical for estimating future pension payments?

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Inflation rate

Discount rate

Employee turnover

Mortality rate

Question 3: How do you assess the "Tail Risk" in financial portfolios, and what models are used to quantify and manage these extreme risks?

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Tail risk is ignored in traditional risk models, as it is assumed to be insignificant

Tail risk is irrelevant if the portfolio is diversified sufficiently

Tail risk only applies to equity portfolios and not to other asset classes

Tail risk is the risk of extreme loss in rare events, and it is assessed using models like extreme value theory (EVT) and stress testing

Question 4: How does bootstrapping help in actuarial risk modeling?

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It helps identify outliers in the data

It is used to predict future claims data

It transforms the data into a normal distribution

It generates multiple simulated samples from a dataset

Question 5: Which statistical test is commonly used to assess whether two populations have the same mean in actuarial analysis?

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ANOVA Test

Chi-Square Test

Wilcoxon Signed-Rank Test

Two-sample t-test

Question 6: In actuarial pricing models, which distribution is most commonly used to model the severity of claims?

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Gamma distribution

Binomial distribution

Normal distribution

Poisson distribution