## 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. Confidence ellipse**

**2. Regime - switching volatility model**

**3. Implied standard deviation for options**

**4. Importance sampling technique**

**5. Variance - covariance approach for VaR of a portfolio**

**6. Persistence**

**7. GPD**

**8. Adjusted R^2**

**9. Variance of X+Y assuming dependence**

**10. Variance of aX + bY**

**11. Bernouli Distribution**

**12. Reliability**

**13. Type II Error**

**14. Logistic distribution**

**15. ESS**

**16. Marginal unconditional probability function**

**17. F distribution**

**18. T distribution**

**19. Block maxima**

**20. Covariance calculations using weight sums (lambda)**

**21. Continuous representation of the GBM**

**22. Deterministic Simulation**

**23. Extreme Value Theory**

**24. Hazard rate of exponentially distributed random variable**

**25. GEV**

**26. Time series data**

**27. Two requirements of OVB**

**28. Cholesky factorization (decomposition)**

**29. Mean reversion in variance**

**30. Homoskedastic**

**31. Mean reversion in asset dynamics**

**32. Two assumptions of square root rule**

**33. Simplified standard (un - weighted) variance**

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

**35. Tractable**

**36. Four sampling distributions**

**37. Standard error**

**38. SER**

**39. Significance =1**

**40. Antithetic variable technique**

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

**42. Potential reasons for fat tails in return distributions**

**43. BLUE**

**44. Monte Carlo Simulations**

**45. P - value**

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

**47. K - th moment**

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

**49. Implications of homoscedasticity**

**50. Control variates technique**