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3. (20 points total) A. What is Value at risk (VAR). (10 points) B. If you are a portfolio manager managing a portfolio valued 1

3. (20 points total) A. What is Value at risk (VAR). (10 points)

B. If you are a portfolio manager managing a portfolio valued 1 million dollars. Your risk manager tells you that 5% VAR is 1000 dollars. What does the risk manager mean? (10 points)

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