Matching the Maturities of Assets and Liabilities Is Not a Perfect

question 65

True/False

Matching the maturities of assets and liabilities is not a perfect method of immunizing the balance sheet because the timing of the cash flows is likely to differ between the assets and liabilities.

Identify and understand the application of conditioning principles in real-life scenarios.

Understand the concepts of shaping and higher-order conditioning.

Understand the role and importance of business plans for entrepreneurs.

Recognize the importance of financial planning and awareness of funding sources for small businesses.

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Definitions:

Mere-Exposure Effect

A psychological phenomenon by which people tend to develop a preference for things or people they are exposed to frequently.

Self-Serving Bias

A cognitive bias that causes individuals to see themselves in a more favorable light, attributing successes to internal factors and failures to external factors.

Situational Bias

The effect that context or environment can have on an individual's behaviour or decisions, often leading to skewed perceptions or judgements.

Internal Bias

Refers to the personal, often unconscious, predispositions or tendencies that affect one's decisions, perceptions, and interactions.