(no subject)

Jean-Pierre Gagnon ( (no email) )
Mon, 29 Mar 1999 17:18:05 -0500

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Mark,

I think you are doing it the right way. That's how I do it anyway. I think
he's doing a lot of approximation in his calculations. Very frustrating
indeed!

Jean-Pierre
-----Original Message-----
From: Mercier, Mark F. [mailto:MERM235@LNI.WA.GOV]
Sent: March 29, 1999 5:10 PM
To: CAS Part 10
Subject:

I've got a question regarding Stones Capacity paper.

On page 342, right below the equation "Exposure Ratio = 1000%", Stone
says that "...it follows that the maximum acceptable Exposure Ratio is .03
or 3%..." As if it were obvious. I don't think it's obvious and I'd like
to know where the 3% came from.

I THINK it's a part 2 question, using the normal approximation, solving
for sigma.

P(x>X) = 0.01
P((x-u)/s > ....

Which gets me NEAR the 3% Stone claims.

It's probably not important, but I'd like to know. Stones paper seems
so
full of bad calcs and even some questionable theory that I'm not at all
comfortable with my approach to finding the source of the 3%.

Help?

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Mark,
 
I=20think you are doing it the right way. That's how I do it anyway. I think =he's=20doing a lot of approximation in his calculations. Very frustrating=20indeed!
 
Jean-Pierre
-----Original Message-----
From: Mercier, Mark F. = [mailto:MERM235@LNI.WA.GOV]
Sent: March 29, 1999 5:10=20 PM
To: CAS Part 10
Subject: =

I've got a question regarding =Stones Capacity=20 paper.

On page 342, right below the =equation=20 "Exposure Ratio =3D 1000%", Stone says that "...it =follows that=20 the maximum acceptable Exposure Ratio is .03 or 3%..."  As =if it=20 were obvious.  I don't think it's obvious and I'd like to know =where=20 the 3% came from.

 
I=20 THINK it's a part 2 question, using the normal approximation, =solving=20
for sigma.
 
P(x>X) ==3D 0.01=20
P((x-u)/s > .... =
 
Which gets=20 me NEAR the 3% Stone claims.
 
It's =probably not=20 important, but I'd like to know.  Stones paper seems so=20
full of bad calcs and even some =questionable=20 theory that I'm not at all
comfortable=20 with my approach to finding the source of the 3%.

Help? =

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