What Is the Correct Interpretation of a EUR 5,000,000

question 160

Multiple Choice

What is the correct interpretation of a EUR 5,000,000.00 one-week VaR figure with a 99% confidence level?

• A) A loss of at least EUR 5,000,000.00 can be expected in 99 out of the next 100 weeks.
• B) A loss of at most EUR 5,000,000.00 can be expected in 1 out of the next 100 weeks.
• C) A loss of at most EUR 5,000,000.00 can be expected in 1 out of the next 100 days.
• D) A loss of at least EUR 5,000,000.00 can be expected in 1 out of the next 100 weeks.

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Definitions:

Gestalt Psychology

A theory in psychology that emphasizes the human mind and behavior as a whole rather than separate parts.

Structuralist Approach

An intellectual movement and method of analysis, rooted in linguistics and psychology, that focuses on elements of human culture and the processes of how they relate to each other to form a structure.

Natural Selection

The basis of evolution; the idea that those who inherit characteristics that help them adapt to their particular environments have a selective advantage over those who do not.

Functionalism

A perspective in psychology focused on how mental and behavioral processes enable an organism to adapt, survive, and thrive.