I. Answer the following questions: a) Explain how the liquidity coverage ratio and the net stable funding ratio are defined [10 marks] b) When Value at Risk is used in an attempt to limit the risks taken by a trader, it can lead to undesirable results. Do you agree with this statement? [15 marks] c) Suppose that a 99% VaR model is back-tested using 275 days of trading data. If 7 exceptions were observed, should the model be rejected at the 95% level of confidence? [20 marks]