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The power law. Suppose that there is a 2.5% probability that operational risk losses of a certain type exceed $8 million. Use the power law

The power law. Suppose that there is a 2.5% probability that operational risk losses of a certain type exceed $8 million. Use the power law with parameter equal to 1.80.

a. What is the probability of losses exceeding $12 million? Round your answer to two decimals.

b. What is the worst-case loss at 92% confidence level? $ Round your answer to two decimals.

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