GARP Risk and AI (RAI) Practice Exam 2026 – The Comprehensive All-in-One Guide to Exam Success!

Nominal data have no inherent order and represent categories without rank. They label groups without implying any hierarchy, so you can count how many items fall into each category but you cannot say one category is greater or lesser than another, nor perform meaningful arithmetic with the category labels. Examples include gender, color, or country of birth. This contrasts with ordinal data, where categories do have a meaningful order (for example, satisfaction levels from low to high), though the distances between steps aren’t necessarily equal. Numerical data are quantitative values with meaningful magnitude and support arithmetic operations, while time series focuses on data points collected over time, where the order of observations matters.