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NEW QUESTION: 1
An operational loss severity distribution is estimated using 4 data points from a scenario. The management institutes additional controls to reduce the severity of the loss if the risk is realized, and as a result the estimated losses from a 1-in-10-year losses are halved. The 1-in-100 loss estimate however remains the same.
What would be the impact on the 99.9th percentile capital required for this risk as a result of the improvement in controls?
A. Can't say based on the information provided
B. The capital required will decrease
C. The capital required will stay the same
D. The capital required will increase
Answer: D
Explanation:
Explanation
This situation represents one of the paradoxes in estimating severity that one needs to be aware of - the improvement in controls reduces the weight of the body/middle of the distribution and moves it towards the tails (as the total probability under the curve must stay at 100%) and the distribution becomes more heavy tailed. As a result, the 99.9th percentile loss actually increases. instead of decreasing, creating a counterintuitive result. Therefore the correct answer is that the capital required will increase.
If scenario analysis produces such a result, the analyst must question if the 1 in 100 year loss severity is still accurate. If the new control has reduced the severity in the body of the distribution, the question as to why the more extreme losses have not changed should be raised.
NEW QUESTION: 2
Refer to the exhibit.
Which statement accurately described the output?
A. The displayed endpoint is a local VTEP
B. There are two endpoints associated to the 10.2.2.10 IP address
C. There are two EPGs associated to the 10.2.2.10 IP address
D. The displayed endpoint is attached via a vPC.
Answer: B
NEW QUESTION: 3
Where should you store the environment settings that are prone to changes?
Options are :
A. Inside config files (.xmI, .json, .xlsx, etc.)
B. Directly inside the workflows, as hard coded values
C. In Orchestrator ,as assets
Answer: A
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