## Test your basic knowledge |

# FRM Foundations Of Risk Management Quantitative Methods

**Instructions:**

- Answer 50 questions in 15 minutes.
- If you are not ready to take this test, you can study here.
- Match each statement with the correct term.
- Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.

**1. Mean reversion in variance**

**2. Tractable**

**3. Cross - sectional**

**4. Biggest (and only real) drawback of GARCH mode**

**5. Standard variable for non - normal distributions**

**6. Monte Carlo Simulations**

**7. Variance of X - Y assuming dependence**

**8. Extending the HS approach for computing value of a portfolio**

**9. Variance(discrete)**

**10. Variance of X+b**

**11. Test for statistical independence**

**12. Two ways to calculate historical volatility**

**13. Multivariate Density Estimation (MDE)**

**14. Poisson distribution equations for mean variance and std deviation**

**15. Simulation models**

**16. Continuous representation of the GBM**

**17. Importance sampling technique**

**18. Difference between population and sample variance**

**19. Confidence ellipse**

**20. Hybrid method for conditional volatility**

**21. Variance of weighted scheme**

**22. Mean reversion in asset dynamics**

**23. LFHS**

**24. Central Limit Theorem**

**25. What does the OLS minimize?**

**26. SER**

**27. Logistic distribution**

**28. Binomial distribution equations for mean variance and std dev**

**29. Binomial distribution**

**30. Extreme Value Theory**

**31. Heteroskedastic**

**32. Unconditional vs conditional distributions**

**33. Regime - switching volatility model**

**34. Deterministic Simulation**

**35. Control variates technique**

**36. P - value**

**37. LAD**

**38. Type I error**

**39. GPD**

**40. Single variable (univariate) probability**

**41. Variance of sampling distribution of means when n<N**

**42. POT**

**43. Simulating for VaR**

**44. Limitations of R^2 (what an increase doesn't necessarily imply)**

**45. Least squares estimator(m)**

**46. Multivariate probability**

**47. Continuous random variable**

**48. Test for unbiasedness**

**49. Weibul distribution**

**50. Sample mean**