Actuarial Notes

Exam DISC-DA Practice Question 4

Study guide: Exam DISC-DA

A commercial auto file stores each vehicle's class as a four-digit integer taken from a class table, such as 2111, 3141 and 7398. A modeler plans to enter class_code in a GLM as a single numeric predictor. How should the field be classified?

  • A) As continuous numeric, so one slope across the code values is appropriate
  • B) As ordinal, so its levels can be coded in numeric order with equal steps
  • C) As nominal categorical, so it enters as a set of levels rather than a slope
  • D) As a discrete count, so it should be modelled with a count distribution

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