Free GARP FRM-Part-2 Exam Questions

Time steps that enter into the calculation of the number of days in the margin period of risk include all of the following except:

Which of the following statements regarding risk management programs with service providers to manage outsourcing risk is correct?

Assume that a credit rating of A has a default probability of 0.07%, and a credit rating of AA has a default probability of 0.04%. If a bank is seeking a target rating of A, it will want to ensure that its economic capital will cover unexpected losses at a confidence level of:

An operational risk analyst at a large bank is preparing a year-end report of thebank’s operational loss events. The analyst uses the Basel operational risktaxonomy to classify different events into Level 1, Level 2, and Level 3. As part ofthis process, the analyst considers the following four events that occurred during the year:• A sales representative in the lending department forged a senior manager’ssignature to approve an application for a large commercial loan that defaulted.• The bank failed to deliver sufficient collateral to support a swap position,which was later terminated at a loss.• Several managers in the bank’s wealth management group were found tohave misused confidential customer information by sharing this informationwith other employees and a third-party vendor representative.• Some personal customer information was stolen in a cyber-attack in whichan external hacker broke into a database stored in the cloud.In classifying the four events and considering the Basel taxonomy in general, whichof the following actions would be most appropriate for the analyst to take?

Within the context of the three lines of defense model, risk champions (or risk specialists) are most likely to be included in which lines?