What Is the Correct Interpretation of a EUR 2,000,000

question 43

Multiple Choice

What is the correct interpretation of a EUR 2,000,000.00 overnight VaR figure with a 97% confidence level?

• A) A loss of at least EUR 2,000,000.00 can be expected in 97 out of the next 100 days.
• B) A loss of at most EUR 2,000,000.00 can be expected in 3 out of the next 100 days.
• C) A loss of at least EUR 2,000,000.00 can be expected in 3 out of the next 100 days.
• D) A loss of at most EUR 2,000,000.00 can be expected in 6 out of the next 100 days.

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Definitions:

Spending Variance

The difference between the actual amount of money spent and the budgeted amount for various categories.

Press Runs

The total number of units produced in one setup or operation of a press machine.

Wages And Salaries

Compensation paid to employees for their labor, including hourly payments (wages) and fixed annual or monthly payments (salaries).

Spending Variance

The difference between the actual amount of money spent and the budgeted or expected amount, indicating over- or under-spending.