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NEW QUESTION: 1
Which of the following statements are true:
I. Pre-settlement risk is the risk that one of the parties to a contract might default prior to the maturity date or expiry of the contract.
II. Pre-settlement risk can be partly mitigated by providing for early settlement in the agreements between the counterparties.
III. The current exposure from an OTC derivatives contract is equivalent to its current replacement value.
IV. Loan equivalent exposures are calculated even for exposures that are not loans as a practical matter for calculating credit risk exposure.
A. III and IV
B. I, II, III and IV
C. II and III
D. II and IV
Answer: B
Explanation:
Explanation
Pre-settlement risk is the risk that one of the counterparties defaults prior to the date for the maturity of the transaction in question. This may be an unrelated default, in fact there may have been no default on that particular contract, but the party may have defaulted on its other obligations, or filed for bankruptcy. To deal with such cases and to protect the interests of both the parties, it is common to provide for immediate termination of positions and settlement based on the current replacement value of the contracts. Therefore statements I and II are correct.
Statement III is correct as well - the exposure from an OTC derivative contract derives from its current replacement value, and not the notional. If the current replacement value is negative, then the credit exposure is considered equal to zero.
Statement IV is correct as it is quite common to restate all exposures - those from credit lines, OTC derivatives etc - in loan equivalent terms prior to estimating credit risk.

NEW QUESTION: 2
Which of the following best describes the concept of marginal VaR of an asset in a portfolio:
A. Marginal VaR is the value of the expected losses on occasions where the VaR estimate is exceeded.
B. Marginal VaR is the change in the VaR estimate for the portfolio as a result of including the asset in the portfolio.
C. Marginal VaR describes the change in total VaR resulting from a $1 change in the value of the asset in question.
D. Marginal VaR is the contribution of the asset to portfolio VaR in a way that the sum of such calculations for all the assets in the portfolio adds up to the portfolio VaR.
Answer: C
Explanation:
Explanation
The correct answer is choice 'd'
Marginal VaR is just the change in total VaR from a $1 change in the value of the asset in the portfolio. All other answers are incorrect. Mathematically, it is expressed as follows, where VaRp is the VaR for the portfolio, and Vi is the value of the asset in question.

Other answers describe other VaR related concepts such as incremental VaR, Component VaR and Conditional VaR.

NEW QUESTION: 3
Which of the following functions can be used as a countermeasure to a Shell Injection attack?
Each correct answer represents a complete solution. Choose all that apply.
A. mysql_real_escape_string()
B. regenerateid()
C. escapeshellarg()
D. escapeshellcmd()
Answer: C,D

NEW QUESTION: 4
Refer to the exhibit.

Site A and site B have a 3-hour time difference. An administrator has time-of-day routing configured at site A and site B for all incoming calls to the main phone number, DN 8000. Two hunt pilots with the same DN are configured with the time periods of site A and B.
Which Statement about the incoming calls is true?
A. Incoming calls to hunt pilot 8000 on Saturday are answered by the site A IP phone.
B. Incoming calls to hunt pilot 8000 on Saturday after 17:00 PST are answered by the site A and site B IP phones.
C. Incoming calls to hunt pilot 8000 on Sunday are answered by the site B IP phone
D. Incoming calls to hunt pilot 8000 on Wednesday after 15:00 PST are answered by the site B IP phone.
Answer: D

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