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NEW QUESTION: 1
Bank G has a 1-year VaR of USD 20 million at 99% confidence level while bank H has a 1year VaR of USD 10 million at the same confidence level. Which bank is in a more risky position as measured by VaR?
A. Bank G is taking twice the risk of bank H as measured by VaR.
B. Both banks are equally risky since the measurements are with the same confidence level.
C. Since the confidence levels are the same we cannot make any conclusions.
D. Bank H is taking twice the risk of bank G as measured by VaR.
Answer: A
NEW QUESTION: 2
Intensity of rivalry among existing firms in an industry increases when:
I.Products are relatively undifferentiated.
II.Consumer switching costs are low.
A. Both I and II.
B. II only.
C. Neither I nor II.
D. I only.
Answer: A
Explanation:
The degree of product differentiation and the costs of switching from one competitor's product to another increase the intensity of rivalry and competition in an industry. Less differentiation tends to heighten competition based on price, with price cutting leading to lower profits. Low costs of switching products also increase competition.
NEW QUESTION: 3
A. Option D
B. Option B
C. Option C
D. Option A
Answer: B
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