Q. Using a value at risk (VaR) model based on historical data to forecast future expected losses works well:

1. all the time.
2. during times of normal market conditions.
3. during times of increased market volatility.

Q. According to the discounted cash flow method, the value of a bond equals the sum of the:

1. present values of the expected coupon payments.
2. expected coupon payments and final principal payment.
3. present values of the expected coupon payments and the final principal payment.