PRMIA 8009 : Exam IV: Case Studies: Standards: Governance, Best Practices and Ethics - 2015 Edition

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Exam Code: 8009

Exam Name: Exam IV: Case Studies: Standards: Governance, Best Practices and Ethics - 2015 Edition

Updated: Jun 02, 2026

Q & A: 112 Questions and Answers

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PRMIA Exam IV: Case Studies: Standards: Governance, Best Practices and Ethics - 2015 Edition Sample Questions:

1. Which of the following was the key contributory risk factor to the problems at LTCM in the summer of 1998?
I. Model Risk
II. Lack of Transparency
III. Breakdown of Historical Correlations
IV. Over Regulation by Federal Regulators

A) III and IV only
B) I and III only
C) All of these were key elements of the problems at LTCM
D) III only


2. Finite insurance is reinsurance which

A) transfers only a limited amount of risk at the usual reinsurance price
B) transfers the total risk at the usual reinsurance price
C) transfers the total risk at less cost than traditional reinsurance
D) transfers only a limited amount of risk at less cost than traditional reinsurance


3. PRMIA is incorporated as:

A) A non-profit corporation
B) A charitable trust
C) A for-profit corporation
D) A non profit corporation with for profit subsidiaries


4. Mary Jones wants the Bylaws of PRMIA to be changed so that people can't join PRMIA unless they meet a set of criteria she has devised with her colleagues. She can do this by getting which of the following approvals:

A) The Board of Directors, but only if the Blue Ribbon Panel affirms the change
B) The Board of Directors and a majority of the Members
C) 34 of all Members
D) The Board of Directors alone


5. As a result of the US government's intervention, which of the following is true?

A) The systemic risks still remain in the housing market because it increases the US government's debt
B) The cost of borrowing for house buyers will rise because of the risk premium now built into the cost of such a government guarantee
C) Foreign Central Banks will continue to sell their holdings of Fannie Mae and Freddie Mac securities
D) The cost of borrowing for Fannie Mae and Freddie Mac should decline because the government will be standing behind their debts and the buying and selling of mortgage debt will continue


Solutions:

Question # 1
Answer: D
Question # 2
Answer: D
Question # 3
Answer: A
Question # 4
Answer: B
Question # 5
Answer: D

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