- CFA Exams
- CFA Exam: Level II 2021
- Study Session 3. Quantitative Methods (2)
- Reading 9. Excerpt from Probabilistic Approaches: Scenario Analysis, Decision Trees, and Simulations
- Subject 2. Advantages, issues and constraints
CFA Practice Question
What type of probability distributions would analysts like the most in simulations?
B. Forward looking
C. Backward looking
A. Historical
B. Forward looking
C. Backward looking
Correct Answer: B
They seldom get forward looking probability distributions, though.
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