Deal of The Day! Hurry Up, Grab the Special Discount - Save 25% - Ends In 00:00:00 Coupon code: SAVE25
Welcome to Pass4Success

- Free Preparation Discussions
Mail Us support@pass4success.com
Location US
Mob_nav_barsMENU

PRMIA Exam 8010 Topic 1 Question 41 Discussion

Actual exam question for PRMIA's 8010 exam
Question #: 41
Topic #: 1
[All 8010 Questions]

Which of the following are valid approaches for extreme value analysis given a dataset:

1. The Block Maxima approach

2. Least squares approach

3. Maximum likelihood approach

4. Peak-over-thresholds approach

Show Suggested Answer Hide Answer
Suggested Answer: C

For EVT, we use the block maxima or the peaks-over-threshold methods. These provide us the data points that can be fitted to a GEV distribution.

Least squares and maximum likelihood are methods that are used for curve fitting, and they have a variety of applications across risk management.


by Simona at Feb 12, 2024, 12:46 AM

Limited Time Offer

25%

Off

Get Premium 8010 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel
Layla
8 months ago
That's an interesting point, Pansy. It's important to consider the purpose and suitability of each approach in extreme value analysis.
upvoted 0 times
...
Pansy
8 months ago
I believe the Maximum likelihood approach is not suitable for extreme value analysis as it focuses on parameter estimation rather than extreme values.
upvoted 0 times
...
Alexia
8 months ago
Really, Pansy? Can you explain your rationale for excluding the Maximum likelihood approach?
upvoted 0 times
...
Pansy
8 months ago
I'm not so sure. I think the valid approaches are the Block Maxima approach and the Peak-over-thresholds approach only.
upvoted 0 times
...
Layla
8 months ago
I agree with you, Alexia. Those three approaches make sense for extreme value analysis.
upvoted 0 times
...
Alexia
8 months ago
I think the valid approaches for extreme value analysis given a dataset are the Block Maxima approach, the Maximum likelihood approach, and the Peak-over-thresholds approach.
upvoted 0 times
...
Nathan
8 months ago
I personally prefer using the Least squares approach for extreme value analysis, so I would go with option A) 2 and 3.
upvoted 0 times
...
Danica
9 months ago
I think the correct answer is probably B) 1, 3 and 4, as all three approaches seem reasonable for extreme value analysis.
upvoted 0 times
...
Brittani
10 months ago
I agree with you on the Block Maxima approach, but I also believe that the Maximum likelihood approach is valid.
upvoted 0 times
...
Aretha
10 months ago
I think the valid approaches for extreme value analysis are the Block Maxima approach and the Peak-over-thresholds approach.
upvoted 0 times
...

Save Cancel