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NEW QUESTION: 1
Which of the following is an example of a technique used in quantitative risk analysis?
A. Risk data quality assessment
B. Probability and impact matrix
C. Risk categorization
D. Sensitivity analysis
Answer: D

NEW QUESTION: 2
Janice Palmer, CFA, is an international equity analyst at a large investment management firm catering to high net worth U.S. investors. She is assisted by Morgan Greene and Cathy Wong. Both Greene and Wong have prepared their preliminary security selections and are meeting along with Palmer today for detailed security analysis and valuation. They have narrowed their focus to a few closed-end country funds and some firms from Switzerland, Germany, the U.K. and the emerging markets.
The initial decision is to choose between closed-end country funds and direct investment in foreign stock markets. Wong is in favor of country funds because:
1. Country funds provide immediate diversification.
2. Buying country funds is a better choice than direct investment for most emerging markets.
However, Wong has observed a premium to NAV that is prevalent in closed-end country funds. Wong is curious as to how the observed premiums would affect investments in such instruments.
In contrast to Wong, Greene is more inclined towards individual stocks and has started looking into their financial statements. One firm Greene is analyzing is a German conglomerate. Kaiser Corp. Kaiser has a history of growing by acquiring high-growth firms in niche markets. Exhibit 1 provides key financial information from Greene's analysis of Kaiser Corp.
Exhibit 1: Financial information-Kaiser Corp.

While going through their sample of emerging market stocks, Wong observed that these markets in general have high inflation and that sales for the stocks were extremely seasonal. Wong compensated by adjusting reported sales growth in the emerging market firms by deflating the sales using annual inflation adjustments. Wong also made upward adjustments to reported depreciation figures.
Wong suggested to her colleagues that they add a country risk premium to the discount rate they were using to evaluate emerging market stocks. She further suggested that they estimate country risk premiums by calculating the spread between the yield of U.S. government bonds and that of similar maturity local bonds.
Subsequently they started working on the financial projections for Emerjico, Inc., an emerging market stock. Their assumptions are given in Exhibit 2.
Exhibit 2: Key Assumptions-Emerjico

In response to Wong's curiosity about the effects of the NAV premium on country fund investments, Palmer is least likely to suggest that the premiums:
A. are not steady but quite volatile.
B. add to the return of the fund.
C. add to the risk of the fund.
Answer: B
Explanation:
Explanation/Reference:
Explanation:
The closed-end country fund premiums ro net asset value are themselves very volatile and add to the risk of the fund. They tend to decrease as die country liberalizes foreign access to their financial markets.
However, the fund premiums do not add to the return of the fund. (Study Session 10, LOS 34,g,i)

NEW QUESTION: 3
When reviewing the disaster recovery plan for two data centers, you find that:
-The copy of data at remote Site B will lag behind the production data at Site A by 5 minutes -It will take 2 hours after an outage at Site A to shift production to Site B. -Three more hours will be needed to power up the servers, bring up the network, and redirect
users to Site B.
What is the recovery point objective (RPO) of this plan?
A. 5 minutes
B. 5 hours
C. 5 hours 5 minutes
D. 2 hours
Answer: A