Duration Analysis Involves Comparing the Average Duration of the Bank's

question 123

Multiple Choice

Duration analysis involves comparing the average duration of the bank's ________ to the average duration of its ________.

• A)securities portfolio;non-deposit liabilities
• B)assets;liabilities
• C)loan portfolio;deposit liabilities
• D)assets;deposit liabilities

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Definitions:

Simple Interest

Interest calculated on the principal portion of a loan or deposit, using a simple calculation that does not compound.

Monthly Basis

An occurrence or calculation that happens every month.

Round Answers

Round Answers indicates the practice of adjusting numerical answers to a specified degree of precision, often the nearest whole number, to simplify presentation or calculation.

Simple Interest

Simple interest is a calculation of interest that does not take into account the effect of compounding. Interest is applied only to the principal over a set period.