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NEW QUESTION: 1
Which of the following statements is the most appropriate description of feedback effects:
A. The lack of a comprehensive view of risk across credit, market and liquidity risks leading to an underestimation of correlations that tend to spike up in the event of a crisis
B. The revision of stress testing scenarios based upon management, business unit and regulatory feedback on the plausibility or otherwise of stress scenarios.
C. The amplification of smaller initial shocks to one risk factor creating larger subsequent shocks through system-wide interactions between other risks, creating self-perpetuating downward stresses in the markets
D. The spread of contagion from the bankruptcy of one participant leading to a similar outcome for other market participants
Answer: C
Explanation:
Explanation
Choice 'a' (The amplification of smaller initial shocks to one risk factor creating larger subsequent shocks through system-wide interactions between other risks, creating self-perpetuating downward stresses in the markets) is the most comprehensive description of 'feedback effects', as described in the BCBS document on stress testing. Choice 'c' is one manifestation of feedback effects, but does not describe the entire effect.
Choice 'b' is not a description of 'feedback effects', but one of the various weaknesses in stress testing that was seen during the crisis. Choice 'd' is plain nonsensical.
The BCBS paper provides a good and succinct description of feedback effect: how mortgage default shocks led to a deterioration of market prices of CDOs, followed by a drying up of the liquidity in these markets. This led to banks having to hold on to assets they intended to securitize (securitization and warehousing risk), and given the absence of transparency on who was exposed to what, banks refusing to lend to each other and a drying up of the wholesale funding market as well. All of this was additionally accompanied by a general flight to quality, households withdrawing money from money market funds creating a crisis in that market as well. At each stage, the initial shock was amplified and fed back into the system through interactions that had not been imagined by any market participant or regulator, leave alone risk managers.

NEW QUESTION: 2
A network administrator is troubleshooting the OSPF configuration of routers R1 and R2.
The routers cannot establish an adjacency relationship on their common Ethernet link.
The graphic shows the output of the show ip ospf interface e0 command for routers R1 and R2.

Based on the information in the graphic, what is the cause of this problem?
A. The cost on R1 should be set higher.
B. The hello and dead timers are not configured properly.
C. The OSPF process ID numbers must match.
D. The OSPF area is not configured properly.
E. A backup designated router needs to be added to the network.
F. The priority on R1 should be set higher.
Answer: B

NEW QUESTION: 3
The Cisco UCS administrator has the chassis discovery policy set to "2-link". The administrator connects a new chassis to the Cisco UCS 6200 Series Fabric Interconnects using four links.
Which option about link utilization is true?
A. The Cisco UCS will use only two links. However, the administrator can manually pin traffic to the extra links by using service profiles.
B. The Cisco UCS will use two links until the chassis is reacknowledged, after which it will use all four links.
C. The Cisco UCS will use only two links. The other two links are unusable.
D. The Cisco UCS will use all four links for discovery.
Answer: B
Explanation:
Section: Questions
Explanation/Reference:
Explanation: