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NEW QUESTION: 1
For an equity portfolio valued at V whose beta is , the value at risk at a 99% level of confidence is represented by which of the following expressions? Assume represents the market volatility.
A. 1.64 x x V x
B. 2.326 x x V x
C. 1.64 x V x /
D. 2.326 x V x /
Answer: B
Explanation:
Explanation
For the PRM exam, it is important to remember the z-multiples for both 99% and 95% confidence levels (these are 2.33 and 1.64 respectively).
The value at risk for an equity portfolio is its standard deviation multiplied by the appropriate z factor for the given confidence level. If we knew the standard deviation, VaR would be easy to calculate. The standard deviation can be derived using a correlation matrix for all the stocks in the portfolio, which is not a trivial task.
So we simplify the calculation using the CAPM and essentially say that the standard deviation of the portfolio is equal to the beta of the portfolio multiplied by the standard deviation of the market.
Therefore VaR in this case is equal to Beta x Mkt Std Dev x Value x z-factor, and therefore Choice 'a' is the correct answer.

NEW QUESTION: 2
You ran a demand plan with the data refresh option "Do not refresh with current data." Identify two true statements.
A. Shipments history data will be updated.
B. Forecasting engine will run without advancing the plan date.
C. Shipments forecast data will not be modified.
D. forecasting engine will not run.
E. Shipments history data will not be modified.
Answer: C,E

NEW QUESTION: 3
Which of the following is a form of principled bargaining in which the parties look at all the issues and are able to make mutually agreeable trade-offs between those issues?
A. Interest-based bargaining
B. Parallel bargaining
C. Integrative bargaining
D. Single-unit bargaining
Answer: C
Explanation:
Answer option B is correct.Integrative bargaining is a form of principled bargaining in which the parties look at all the issues and are able to make mutually agreeable trade-offs between those issues.Answer option A is incorrect. Interest-based bargaining (IBB) is based on the concept that both sides in the negotiation have harmonious interests.Answer option D is incorrect. Single-unit bargaining occurs when one union meets with one employer to bargain.Answer option C is incorrect. Parallel bargaining occurs when the union negotiates with one employer at a time. Once a contract has been reached with one employer, the union uses the gains made during the negotiation as a base for negotiating with the next employer. Chapter: Employee and Labor Relations Objective: Union Organization