One of the Problems in Conducting a Duration Gap Analysis

question 59

Multiple Choice

One of the problems in conducting a duration gap analysis is that the duration gap is calculated assuming that interest rates for all maturities are the same. That means that the yield curve is

• A)flat.
• B)slightly upward sloping.
• C)steeply upward sloping.
• D)downward sloping.

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Definitions:

Longitudinal Study

A research design that involves repeated observations of the same variables (e.g., people) over short or long periods of time, often many years.

Correlational Study

A research method that examines the extent to which two variables are related, without inferring a cause-and-effect relationship between them.

Random Assignment

A method used in experiments to place participants into different groups in a way that each participant has an equal chance of being in any group, minimizing biases.

Participants

Individuals who take part in a study or experiment and whose behavior or responses are observed or measured.