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NEW QUESTION: 1
When compared to a medium severity medium frequency risk, the operational risk capital requirement for a high severity very low frequency risk is likely to be:
A. Zero
B. Unaffected by differences in frequency or severity
C. Lower
D. Higher
Answer: A
Explanation:
Explanation
High frequency and low severity risks, for example the risks of fraud losses for a credit card issuer, may have high expected losses, but low unexpected losses. In other words, we can generally expect these losses to stay within a small expected and known range. The capital requirement will be the worst case losses at a given confidence level less expected losses, and in such cases this can be expected to be low.
On the other hand, medium severity medium frequency risks, such as the risks of unexpected legal claims,
'fat-finger' trading errors, will have low expected losses but a high level of unexpected losses. Thus the capital requirement for such risks will be high.
It is also worthwhile mentioning high severity and low frequency risks - for example a rogue trader circumventing all controls and bringing the bank down, or a terrorist strike or natural disaster creating other losses - will probably have zero expected losses & high unexpected losses but only at very high levels of confidence. In other words, operational risk capital is unlikely to provide for such events and these would lie in the part of the tail that is not covered by most levels of confidence when calculating operational risk capital.
Note that risk capital is required for only unexpected losses as expected losses are to be borne by P&L reserves. Therefore the operational risk capital requirements for a low severity high frequency risk is likely to be low when compared to other risks that are lower frequency but higher severity.
Thus Choice 'c' is the correct answer.

NEW QUESTION: 2
A cloud architect is designing an automated provisioning solution for a private cloud. The disk format for
provisioned VMware virtual machines must allow for the fastest possible provisioning times. Which disk
format satisfies this requirement?
A. Fixed
B. Eager Zeroed
C. Lazy Zeroes
D. Lazy thick random
E. Dynamic
Answer: C

NEW QUESTION: 3
Conference call flow, the task of H.245 capability negotiation are (). (Multiple choice)
A. negotiation video codec protocol
B. negotiation using H.323 protocol or SIP protocol
C. Consultative Meeting Bandwidth
D. Consultative video resolution
Answer: A,D

NEW QUESTION: 4
Section C (4 Mark)
Read the senario and answer to the question.
Assume the following additional facts:
The Shankers have purchased a homeowner's policy (comprehensive) covering 100% of the replacement cost of their residence. This policy has a Rs. 500 deductible. Also, they have purchased a disability income policy with a 30-day elimination period and an any-occupation definition of disability.
What actions should the Shankers consider in order to improve the quality of the insurance program described above?

A. (II) and (IV) only
B. (I) only
C. (I) and (III) only
D. (I) and (IV) only
Answer: D