Question: 10. What is the difference between parametric and nonparametric methods for estimating Var? A. Parametric methods do not make assumptions concerning the distribution of returns

 10. What is the difference between parametric and nonparametric methods for

10. What is the difference between parametric and nonparametric methods for estimating Var? A. Parametric methods do not make assumptions concerning the distribution of returns B. Nonparametric methods assume returns are normally distributed C. Nonparametric methods use historical data D. Parametric methods use future data E. None of the above 11. One reason why a researcher might use the Student's t-distribution for a parametric method is A. t-distribution has a higher mean return than the normal distribution B.t-distribution has skinnier tails than the normal C. t-distribution has fatter tails than the normal D. t-distribution is favored by government regulators E. All of the above 12. The benefits of the VaR method include A. VaR provides multiple numbers that can be utilized as the case requires B. VaR results in lower corporate income tax expense C. VaR can increase yields on Treasury Bonds D. VaR provides a single number that can be easily translated into a capital requirement E. None of the above

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!