IC47A-1 CASUALTY ACTUARIAL SCIENCE PART 1 - 13

Que. 1 : Q1) If : Exposure Units = 50,524
Claim Count = 565, and
Scale Factor = 2,000;
Then : find Frequency per ‘k’ Exposure Units?

   1.  a) 15.65

   2.  b) 18.65

   3.  c) 22.36

   4.  d) 26.35

Que. 2 : Q2) What is a measure of the accuracy of the classification system and this concept is important to the public debate concerning restrictions on the use of classification variables?

   1.  a) Exposure

   2.  b) Efficiency

   3.  c) Controllability

   4.  d) Considerations

Que. 3 : Q3) Which data are organised by year of report to the company, as opposed to year of loss for accident year and this array freezes the inventory of loss to study only those cases actually reported to a company during a calendar year?

   1.  a) Accident year approach

   2.  b) Report year approach

   3.  c) Standard year approach

   4.  d) None of these

Que. 4 : Q4) Which of the following statements is correct?

   1.  a) A risk neutral decision maker would have a utility function that is exponential.

   2.  b) A risk averse decision maker would have a utility function that decreased at a progressively lower rates or had a positive second derivative.

   3.  c) A decision maker who favoured risk would have a utility function that increased at a progressively faster rate or had a positive second derivative.

   4.  d) All the above statements are correct.

Que. 5 : Q5) Which of the following criteria must be met by credibility?

   1.  a) Credibility must not be less than zero or greater than one

   2.  b) Credibility should increase as the size of risk increases, all else being equal

   3.  c) The percentage change of any loss of a given size should decrease as the size of risk increases

   4.  d) All of the above