Free SOA Exam SRM (Statistics for Risk Modeling) Unsupervised Learning Techniques Practice Questions

Unsupervised learning on SOA Exam SRM covers principal component analysis (PCA), k-means and hierarchical clustering, and dimensionality reduction techniques for exploratory data analysis.

127 questions 50 easy 62 medium 15 hard 2026 syllabus

Sample Questions

Question 1 Easy
In PCA, eigenvalues of the covariance matrix represent:
Solution
D is correct.

Each eigenvalue of the covariance (or correlation) matrix equals the variance of the data when projected onto the corresponding principal component. Larger eigenvalues indicate directions that capture more variation in the data.
Question 2 Medium
In PCA, eigenvectors of the covariance matrix are also called:
Solution
E is correct.

The eigenvectors of the covariance (or correlation) matrix define the directions of the principal components. They are commonly referred to as loading vectors because they specify the weight (loading) each original variable receives in the linear combination.
Question 3 Hard
K-means is applied to 6 one-dimensional observations with . After convergence, cluster 1 contains and cluster 2 contains . What is the total within-cluster sum of squares (WCSS)?
Solution
A is correct.

Cluster 1: , centroid

Cluster 1 WCSS:
-
-
-
- Sum =

Cluster 2: , centroid

Cluster 2 WCSS:
-
-
-
- Sum =

Total WCSS .

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