PRACTICE EXAM PART I
2018 Financial Risk Manager Examination (FRM) Part I Practice Exam
2
Table of Contents
Introduction to 2018 FRM Part I Practice Exam .3
2018 FRM Part I Practice Exam – Statistical Reference Tabl
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PRACTICE EXAM PART I
2018 Financial Risk Manager Examination (FRM) Part I Practice Exam
2
Table of Contents
Introduction to 2018 FRM Part I Practice Exam .3
2018 FRM Part I Practice Exam – Statistical Reference Table 5
2018 FRM Part I Practice Exam – Special Instructions and Definitions ..6
2018 FRM Part I Practice Exam – Candidate Answer Sheet ...7
2018 FRM Part I Practice Exam – Questions...8
2018 FRM Part I Practice Exam – Answer Key ..46
2018 FRM Part I Practice Exam – Answers & Explanations ..47
Last updated: 08.01.18
2018 Financial Risk Manager Examination (FRM) Part I Practice Exam
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Introduction
The FRM Exam is a practice-oriented examination. Its questions are derived from a combination of theory, as set forth in the core readings, and “real-world” work experience. Candidates are expected to understand risk management concepts and approaches and how they would apply to a risk manager’s day-to-day activities.
The FRM Exam is also a comprehensive examination, testing a risk professional on a number of risk management concepts and approaches. It is very rare that a risk manager will be faced with an issue that can immediately be slotted into one category. In the real world, a risk manager must be able to identify any number of risk-related issues and be able to deal with them effectively.
The 2018 FRM Part I and Part II Practice Exams have been developed to aid candidates in their preparation for the FRM Exam in May and November 2018. These Practice Exams are based on a sample of questions from prior FRM Exams and are suggestive of the questions that will be on the 2018 FRM Exam.
The 2018 FRM Part I Practice Exam contains 100 multiple-choice questions and the 2018 FRM Part II Practice Exam contains 80 multiple-choice questions, the same number of questions that the actual 2018 FRM Exam Part I and 2018 FRM Exam Part II will contain. As such, the Practice Exams were designed to allow candidates to calibrate their preparedness both in terms of material and time.
The 2018 FRM Practice Exams do not necessarily cover all topics to be tested in the 2018 FRM Exam as any test samples from the universe of testable possible knowledge points. However, the questions selected for inclusion in the Practice Exams were chosen to be broadly reflective of the material assigned for 2018 as well as to represent the style of question that the FRM Committee considers appropriate based on assigned material.
For a complete list of current topics, core readings, and key learning objectives, candidates should refer to the 2018 FRM Exam Study Guide and 2018 FRM Learning Objectives.
Core readings were selected by the FRM Committee to assist candidates in their review of the subjects covered by the Exam. Questions for the FRM Exam are derived from the core readings. It is strongly suggested that candidates study these readings in depth prior to sitting for the Exam.
Suggested Use of Practice Exams:
To maximize the effectiveness of the practice exams, candidates are encouraged to follow these recommendations:
1. Plan a date and time to take the practiceexam.
• Set dates appropriately to give sufficient study/review time for the practice exam prior to the
2018 Financial Risk Manager Examination (FRM) Part I Practice Exam
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actual exam.
2. Simulate the test environment as closely as possible.
• Take the practice exam in a quiet place.
• Have only the practice exam, candidate answer sheet, calculator, and writing instruments
(pencils, erasers) available.
• Minimize possible distractions from other people, cell phones, televisions, etc.; put away any
study material before beginning the practice exam.
• Allocate 4 hours to complete FRM Part I Practice Exam and 4 hours to complete FRM Part II Practice
Exam and keep track of your time. The actual FRM Exam Part I and FRM Exam Part II are 4 hours each.
• Complete the entire exam and answer all questions. Points are awarded for correct answers. There is
no penalty on the FRM Exam for an incorrect answer.
• Follow the FRM calculator policy. Candidates are only allowed to bring certain types of calculators into
the exam room. The only calculators authorized for use on the FRM Exam in 2018 are listed below;
there will be no exceptions to this policy. You will not be allowed into the exam room with a personal
calculator other than the following: Texas Instruments BA II Plus (including the BA II Plus Professional),
Hewlett Packard 12C (including the HP 12C Platinum and the Anniversary Edition), Hewlett Packard 10B
II, Hewlett Packard 10B II+ and Hewlett Packard 20B.
3. After completing the FRM Practice Exams
• Calculate your score by comparing your answer sheet with the practice exam answer key.
• Use the practice exam Answers and Explanations to better understand the correct and incorrect answers
and to identify topics that require additional review. Consult referenced core readings to prepare for
the exam.
• Remember: pass/fail status for the actual exam is based on the distribution of scores from all
candidates, so use your scores only to gauge your own progress and level of preparedness.
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