If Risk Valuation Is Based on a Time Series of Value

question 7

Multiple Choice

If risk valuation is based on a time series of value changes in the asset being considered,the approach is called a _______________ approach.

• A)delta-normal.
• B)value neutral.
• C)historical simulation.
• D)normal distribution.

Analyze the consequences of excess supply or demand on market prices.

Demonstrate understanding of economic efficiency and the role of market equilibrium in achieving it.

Recognize the effect of external factors on the supply and demand of products.

Identify how changes in the cost of production materials influence market supply.

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Definitions:

Economic Profit

The difference between the total revenue earned by a business and the total costs (both explicit and implicit) of all resources used.

Market Price

The current market value at which transactions for a service or asset are conducted.

Units

Basic measures or quantities considered as a standard in terms of which other quantities can be expressed.

Economic Profit

Profit calculated by subtracting both explicit and implicit costs from total revenues, capturing the true profitability of a venture.