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question 37

Multiple Choice

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XYZ Bank has DA = 2.4 years and DL = 0.9 years. The bank has total equity of $82 million and total assets of $850 million. Currently, interest rates are at 6%.
-To set the bank's duration gap to zero the bank could

• A) Reduce DA to 1.2 years
• B) Increase DL to 2.656 years
• C) Increase DL to 2.77 years
• D) Reduce D_A to zero
• E) Increase D_L to 3.10 years

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Definitions:

Quick

Characterized by rapidity or speed in movement, action, or thought.

Causal Relationship

A connection between two variables where a change in one directly causes a change in the other.

Research Design

The overall strategy that outlines the approach for collecting, analyzing, and interpreting data in a research study.

Variables

Elements or factors within a research study or experiment that can change and potentially affect the outcome of the study.