- CFA Exams
- CFA Level I Exam
- Study Session 3. Quantitative Methods (2)
- Reading 9. Excerpt from Probabilistic Approaches: Scenario Analysis, Decision Trees, and Simulations
- Subject 3. An overall assessment of probabilistic risk assessment approaches
CFA Practice Question
It is difficult to model ______ in decision trees.
A. discrete risks
B. sequential risks
C. correlated risks
Explanation: Scenario analysis or simulations should be used instead to model correlated risks.
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