Which of the following statements about stress testing are true? I. Stress t

Which of the following statements about stress testing are true?

I. Stress testing can complement VAR estimation in helping risk managers identify crucial vulnerabilities in a portfolio.

II. Stress testing allows users to include scenarios that did not occur in the lookback horizon of the VAR data but are nonetheless possible.

III. A drawback of stress testing is that it is highly subjective.

IV. The inclusion of a large number of scenarios helps management better understand the risk exposure of a portfolio.

A. I and II only.

B. III and IV only.

C. I II and III only.

D. I II III and IV.