medium · FRM Part 2 Operational Risk
Which of the following describes 'Self-Assessment Bias' in the Risk and Control Self-Assessment (RCSA) process?
- Overestimating the likelihood of low-frequency tail events occurring
- Units under-scoring risk or over-scoring control effectiveness to avoid scrutiny.
- Miscalculating the mean of the loss severity distribution due to a data error
- Relying exclusively on external consortium loss data instead of internal scoring
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