Identify the Three Approaches to Calculating Value at Risk (VaR)

question 67

Essay

Identify the three approaches to calculating value at risk (VaR) and identify one advantage and one disadvantage of each approach.

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Definitions:

Situational Attribution

The process of attributing a person's behavior to external or environmental factors.

Cognitive Dissonance

The psychological discomfort experienced when holding two or more conflicting beliefs, values, or attitudes simultaneously.

Foot-In-The-Door

A persuasion technique where a small request is initially made to get someone to agree to a larger request later.

Situational Attribution

The process of explaining an individual's behavior based on external events or situations, rather than on internal personality traits.