FRM II-OR EDU Q2

anbu.edu
Finance Junkie
Posts: 205
Joined: Mon Feb 04, 2013 3:35 pm

FRM II-OR EDU Q2

Postby anbu.edu » Sat Oct 25, 2014 5:41 pm

Which of the following is NOT a source of model risk?
Select one:
a. Minimal rounding errors from algorithms.
b. Nonsynchronous
data.
c. Widespread implementation of models across business units.
d. Failure to recalibrate models

Ans is A

Can you please explain what error is Minimal rounding errors from algorithms belongs to

edupristine
Finance Junkie
Posts: 722
Joined: Wed Apr 09, 2014 6:28 am

FRM II-OR EDU Q2

Postby edupristine » Wed Oct 29, 2014 12:12 pm

If the rounding errors are minimum from algorithms, it is a desired feature in a model.


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