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In the context of financial risk management, specifically when dealing with the formulation of a risk plan or a risk budget, which of the following statements is most accurate?
A
The risk budget should define acceptable levels of return on risk capital (RORC) for each risk capital allocation.
B
The risk budget should identify the firm's critical dependencies regarding funding and investment performance.
C
The risk plan should state exactly how risk capital should be allocated among asset classes.
D
The risk plan should set volatility goals such as VaR or tracking error for relevant time periods.
