If the Duration Gap Is 0 and Interest Rates Increase

question 41

Multiple Choice

If the duration gap is 0 and interest rates increase:

• A)the market value of assets increases more than the market value of liabilities.
• B)the market value of assets decreases more than the market value of liabilities.
• C)the market value of assets decreases by the same amount as the market value of liabilities.
• D)the market value of assets increases by the same amount as the market value of liabilities.

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Definitions:

Burgundy

A historical region in east-central France, famous for its rich history, medieval heritage, and prestigious wines.

Virgin of Jeanne d'Evreux

A Gothic statuette of the Virgin Mary holding the Christ Child, renowned for its beauty and historical significance in French medieval art.

Theotokos

A title in Christianity, particularly in Eastern Orthodoxy, given to Mary, the mother of Jesus, meaning "God-bearer" or "Mother of God."

Throne of Wisdom

A symbolic representation of the Virgin Mary in medieval Christian art, portraying her as the seat of wisdom with the Christ Child on her lap.