Duration Bank Has the Following Assets and Liabilities as of Year-End

question 57

Multiple Choice

Duration Bank has the following assets and liabilities as of year-end. All assets and liabilities are currently priced at par and pay interest annually. What is the weighted average maturity of the assets of the FI?

• A)2.0 years.
• B)2.3 years.
• C)2.5 years.
• D)2.6 years.
• E)3.0 years.

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Definitions:

Smooth Muscle

A type of muscle tissue which is not under voluntary control, found in the walls of internal organs and blood vessels.

Skeletal Muscle

Muscle tissue that is attached to bones, primarily responsible for voluntary movements through contraction.

Cardiac Muscle

A specialized form of striated muscle found in the heart, characterized by its ability to contract involuntarily and rhythmically, facilitating blood circulation.

Autorhythmic

Spontaneous and periodic—for example, in smooth muscle, spontaneous (without nervous or hormonal stimulation) and periodic contractions.