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NEW QUESTION: 1
Which task requires the use of AWS account root account user credentials?
A. Modifying IAM user permissions
B. Creating a log file
C. Closing an AWS account
D. Deleting IAM users
Answer: C
NEW QUESTION: 2
Credit exposure for derivatives is measured using
A. Standard normal distribution
B. Notional value of the derivative
C. Current replacement value
D. Forward looking exposure profile of the derivative
Answer: D
Explanation:
Explanation
Current replacement values are a very poor measure of the credit exposure from a derivative contract, because the future value of these instruments is unpredictable, ie is stochastic, and the range of values it can take increases the further ahead in the future we look. Therefore it is common for credit exposures for derivatives to be measured using forward looking exposure profiles, which are distributions of the expected value of the derivative at the time horizon for which credit risk is being measured. To be conservative, a high enough quintile of this distribution is taken as the 'loan equivalent value' of the derivative as the exposure. Choice 'c' is the correct answer.
The notional value of derivative contracts generally tends to be quite high and unrelated to their economic value or the counterparty exposure. Therefore notional value is irrelevant.
NEW QUESTION: 3
A. Option C
B. Option B
C. Option D
D. Option A
Answer: D
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