The Average Duration of the Loans Is 10 Years

question 3

Multiple Choice

The average duration of the loans is 10 years. The average duration of the deposits is 3 years. What is the leveraged-adjusted duration gap of the bank's portfolio?

• A)10 years.
• B)7.3 years.
• C)7 years.
• D)7.18 years.
• E)3 years.

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Definitions:

Risk Society

A concept describing modern societies as increasingly preoccupied with the future and also with safety, often addressing risks that are a consequence of technological development.

Technological Hazards

Hazards originating from technological or industrial accidents, infrastructure failures, or certain human activities that may cause harm to people and the environment.

Global Danger

A threat or risk that affects people or environments at a worldwide scale, encompassing issues like climate change, pandemics, and international conflicts.

Technopoly

A culture or society that promotes the ideology that the primary, if not the only, means to solve problems and improve life is through technological solutions and innovation.