Duration Matching Eliminates All Risk

question 22

True/False

Duration matching eliminates all risk.

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Definitions:

Fixed Assets

Long-term tangible assets used in the operations of a business and not expected to be converted to cash in the near term.

Times Interest Earned

Times Interest Earned is a financial ratio that measures a company's ability to meet its debt obligations based on its current earnings before interest and taxes (EBIT).

Days' Sales in Inventory

A financial metric that shows the average duration it takes for a company to turn its inventory into sales.

Car Dealerships

Businesses specialized in selling new or used cars, often also offering maintenance services and financing options.