Section: Security Operation Adimnistration
Explanation/Reference:
Policies are high-level statements, beliefs, goals and objectives and the general means for their attainment for a specific subject area. Standards are mandatory activities, action, rules or regulations designed to provide policies with the support structure and specific direction they require to be effective. Guidelines are more general statements of how to achieve the policies objectives by providing a framework within which to implement procedures. Procedures spell out the specific steps of how the policy and supporting standards and how guidelines will be implemented.
Source: HARE, Chris, Security management Practices CISSP Open Study Guide, version 1.0, april 1999.

Explanation/Reference:
Three concepts are used to create a level of fault tolerance and redundancy in transaction processing.
They are Electronic vaulting, remote journaling and database shadowing provide redundancy at the transaction level.
Electronic vaulting is accomplished by backing up system data over a network. The backup location is usually at a separate geographical location known as the vault site. Vaulting can be used as a mirror or a backup mechanism using the standard incremental or differential backup cycle. Changes to the host system are sent to the vault server in real-time when the backup method is implemented as a mirror. If vaulting updates are recorded in real-time, then it will be necessary to perform regular backups at the off- site location to provide recovery services due to inadvertent or malicious alterations to user or system data.
Journaling or Remote Journaling is another technique used by database management systems to provide redundancy for their transactions. When a transaction is completed, the database management system duplicates the journal entry at a remote location. The journal provides sufficient detail for the transaction to be replayed on the remote system. This provides for database recovery in the event that the database becomes corrupted or unavailable.
There are also additional redundancy options available within application and database software platforms.
For example, database shadowing may be used where a database management system updates records in multiple locations. This technique updates an entire copy of the database at a remote location.
Reference used for this question:
Hernandez CISSP, Steven (2012-12-21). Official (ISC)2 Guide to the CISSP CBK, Third Edition ((ISC)2 Press) (Kindle Locations 20403-20407). Auerbach Publications. Kindle Edition.
and
Hernandez CISSP, Steven (2012-12-21). Official (ISC)2 Guide to the CISSP CBK, Third Edition ((ISC)2 Press) (Kindle Locations 20375-20377). Auerbach Publications. Kindle Edition.

Section: Risk, Response and Recovery
Explanation/Reference:
This is called the Actual Cash Value (ACV) or Actual Cost Valuation (ACV) All of the other answers were only detractors. Below you have an explanation of the different types of valuation you could use. It is VERY important for you to validate with your insurer which one applies to you as you could have some very surprising finding the day you have a disaster that takes place.
Replacement Cost
Property replacement cost insurance promises to replace old with new. Generally, replacement of a building must be done on the same premises and used for the same purpose, using materials comparable to the quality of the materials in the damaged or destroyed property.
There are some other limitations to this promise. For example, the cost of repairs or replacement for buildings doesn't include the increased cost associated with building codes or other laws controlling how buildings must be built today. An endorsement adding coverage for the operation of Building Codes and the increased costs associated with complying with them is available separately - usually for additional premium.
In addition, some insurance underwriters will only cover certain property on a depreciated value (actual cash value - ACV) basis even when attached to the building. This includes awnings and floor coverings, appliances for refrigerating, ventilating, cooking, dishwashing, and laundering. Depreciated value also applies to outdoor equipment or furniture.
Actual Cash Value (ACV)
The ACV is the default valuation clause for commercial property insurance. It is also known as depreciated value, but this is not the same as accounting depreciated value. The actual cash value is determined by first calculating the replacement value of the property. The next step involves estimating the amount to be subtracted, which reflects the building's age, wear, and tear.
This amount deducted from the replacement value is known as depreciation. The amount of depreciation is reduced by inflation (increased cost of replacing the property); regular maintenance; and repair (new roofs, new electrical systems, etc.) because these factors reduce the effective age of the buildings.
The amount of depreciation applicable is somewhat subjective and certainly subject to negotiation. In fact, there is often disagreement and a degree of uncertainty over the amount of depreciation applicable to a particular building.
Given this reality, property owners should not leave the determination of depreciation to chance or wait until suffering a property loss to be concerned about it. Every three to five years, property owners should obtain a professional appraisal of the replacement value and depreciated value of the buildings.
The ACV valuation is an option for directors to consider when certain buildings are in need of repair, or budget constraints prevent insuring all of your facilities on a replacement cost basis. There are other valuation options for property owners to consider as well.
Functional Replacement Cost
This valuation method has been available for some time but has not been widely used. It is beginning to show up on property insurance policies imposed by underwriters with concerns about older, buildings. It can also be used for buildings, which are functionally obsolete.
This method provides for the replacement of a building with similar property that performs the same function, using less costly material. The endorsement includes coverage for building codes automatically.
In the event of a loss, the insurance company pays the smallest of four payment options.
1. In the event of a total loss, the insurer could pay the limit of insurance on the building or the cost to replace the building on the same (or different) site with a payment that is "functionally equivalent."
2. In the event of a partial loss, the insurance company could pay the cost to repair or replace the damaged portion in the same architectural style with less costly material (if available).
3. The insurance company could also pay the amount actually spent to demolish the undamaged portion of the building and clear the site if necessary.
4. The fourth payment option is to pay the amount actually spent to repair, or replace the building using less costly materials, if available (Hillman and McCracken 1997).
Unlike the replacement cost valuation method, which excluded certain fixtures and personal property used to service the premises, this endorsement provides functional replacement cost coverage for these items (awnings, floor coverings, appliances, etc.) (Hillman nd McCracken 1997).
As in the standard replacement cost value option, the insured can elect not to repair or replace the property.
Under these circumstances the company pays the smallest of the following:
1. The Limit of Liability
2. The "market value" (not including the value of the land) at the time of the loss. The endorsement defines
"market value" as the price which the property might be expected to realize if ffered for sale in fair market."
3. A modified form of ACV (the amount to repair or replace on he same site with less costly material and in the same architectural tyle, less depreciation) (Hillman and McCracken 1997).
Agreed Value or Agreed Amount
Agreed value or agreed amount is not a valuation method. Instead, his term refers to a waiver of the coinsurance clause in the property insurance policy. Availability of this coverage feature varies among insurers but, it is usually available only when the underwriter has proof (an independent appraisal, or compliance with an insurance company valuation model) of the value of your property.
When do I get paid?
Generally, the insurance company will not pay a replacement cost settlement until the property that was damaged or destroyed is actually repaired or replaced as soon as reasonably possible after the loss.
Under no circumstances will the insurance company pay more than your limit of insurance or more than the actual amount you spend to repair or replace the damaged property if this amount is less than the limit of insurance.
Replacement cost insurance terms give the insured the option of settling the loss on an ACV basis. This option may be exercised if you don't plan to replace the building or if you are faced with a significant coinsurance penalty on a replacement cost settlement.
References:
http://www.schirickinsurance.com/resources/value2005.pdf
and
TIPTON, Harold F. & KRAUSE, MICKI
Information Security Management Handbook, 4th Edition, Volume 1
Property Insurance overview, Page 587.

Explanation/Reference:
A polymorphic virus has the capability of changing its own code, enabling it to have many different variants, making it harder to detect by anti-virus software. The particularity of a stealth virus is that it tries to hide its presence after infecting a system. A Trojan horse is a set of unauthorized instructions that are added to or replacing a legitimate program. A logic bomb is a set of instructions that is initiated when a specific event occurs.
Source: HARRIS, Shon, All-In-One CISSP Certification Exam Guide, McGraw-Hill/Osborne, 2002, chapter
11: Application and System Development (page 786).

This is a requirement starting as low as C1 within the TCSEC rating.
The Orange book requires the following for System Integrity Hardware and/or software
features shall be provided that can be used to periodically validate the correct operation of
the on-site hardware and firmware elements of the TCB.
NOTE FROM CLEMENT:
This is a question that confuses a lot of people because most people take for granted that
the orange book with its associated Bell LaPadula model has nothing to do with integrity.
However you have to be careful about the context in which the word integrity is being used.
You can have Data Integrity and you can have System Integrity which are two completely
different things.
Yes, the Orange Book does not specifically address the Integrity requirements, however it
has to run on top of systems that must meet some integrity requirements.
This is part of what they call operational assurance which is defined as a level of
confidence of a trusted system's architecture and implementation that enforces the
system's security policy. It includes:
System architecture
Covert channel analysis
System integrity
Trusted recovery
DATA INTEGRITY
Data Integrity is very different from System Integrity. When you have integrity of the data,
there are three goals:
1.Prevent authorized users from making unauthorized modifications
2.Preven unauthorized users from making modifications
3.Maintaining internal and external consistancy of the data
Bell LaPadula which is based on the Orange Book address does not address Integrity, it
addresses only Confidentiality.
Biba address only the first goal of integrity.
Clark-Wilson addresses the three goals of integrity.
In the case of this question, there is a system integrity requirement within the TCB. As mentioned above here is an extract of the requirements: Hardware and/or software features shall be provided that can be used to periodically validate the correct operation of the on-site hardware and firmware elements of the TCB.
The following answers are incorrect:
Security Testing. Is incorrect because Security Testing has no set of requirements in the Orange book.
Design Verification. Is incorrect because the Orange book's requirements for Design Verification include: A formal model of the security policy must be clearly identified and documented, including a mathematical proof that the model is consistent with its axioms and is sufficient to support the security policy.
System Architecture Specification. Is incorrect because there are no requirements for System Architecture Specification in the Orange book.
The following reference(s) were used for this question:
Trusted Computer Security Evaluation Criteria (TCSEC), DoD 5200.28-STD, page 15, 18, 25, 31, 40, 50.
Harris, Shon (2012-10-25). CISSP All-in-One Exam Guide, 6th Edition, Security Architecture and Design, Page 392-397, for users with the Kindle Version see Kindle Locations 28504-28505. and DOD TCSEC - http://www.cerberussystems.com/INFOSEC/stds/d520028.htm