问题如下：
Which of the following statements regarding the choice
of default probability approaches in computing economic capital is correct?
选项：
A.A through-the-cycle (TTC) approach should be used to
price financial instruments with credit risk exposure.
A point-in-time (PIT) approach is more commonly used
for computations involving profitability and strategic decisions.
A TTC approach is more likely to result in a lower
volatility of capital compared to the PIT approach.
A firm’s rating will not change when analyzed under
the PIT approach versus the TTC approach.
解释：
A firm’s rating is more likely to change when analyzed under the point-in-time (PIT) approach compared to the through-the-cycle (TTC) approach. As a result, the TTC approach results in a lower volatility of economic capital compared to the PIT approach.
A PIT approach should be used to price financial
instruments with credit risk exposure and to compute short-term expected
losses. A TTC approach is more commonly used for computations involving
profitability, strategic decisions, and economic capital.
price financial instruments with credit risk exposure 这句话怎么理解，FRM的题太难读懂了
