Preview Questions Data Analyst | Role Specific Skill

Question 1: How do you handle data from multiple financial institutions when performing reconciliation in BFSI?

Which action should you take?

Choose only one option

Apply simple mathematical operations to reconcile

Use data matching and reconciliation algorithms

Merge datasets and let the inconsistencies resolve themselves

Remove all conflicting records

Question 2: What is the most appropriate way to document the steps of data preparation and cleaning in a BFSI data analysis report?

Which action should you take?

Choose only one option

Not needed if the data is clean

In the main report body under methodology

In the appendix with references to the main body

As an external document

Question 3: How do you handle "Multicollinearity" when performing regression analysis on financial data with multiple predictors?

Which action should you take?

Choose only one option

I use techniques like Variance Inflation Factor (VIF) to detect and address multicollinearity by removing or combining predictors

I add more predictors to overcome multicollinearity

I ignore multicollinearity as long as the predictors are statistically significant

I rely on principal component analysis (PCA) to handle multicollinearity

Question 4: What is the primary use of hypothesis testing in financial analysis?

Which action should you take?

Choose only one option

To compare two or more groups and assess the evidence for differences

To validate assumptions about the financial model

To assess the normality of returns

To predict future trends in the market

Question 5: How do you handle high cardinality categorical variables when preparing data for machine learning algorithms?

Which action should you take?

Choose only one option

Apply target encoding to handle rare categories

Drop high cardinality categories

Use frequency encoding to represent categories

Apply one-hot encoding for all categories

Question 6: In a financial dataset, if the data follows a normal distribution, what transformation can be performed to make it suitable for parametric tests?

Which action should you take?

Choose only one option

Box-Cox transformation

Z-score normalization

Min-Max scaling

Logarithmic transformation