"Matching the Book" or Trying to Match the Maturities of Assets

question 16

Multiple Choice

"Matching the book" or trying to match the maturities of assets and liabilities is intended to protect the FI from

• A)liquidity risk.
• B)interest rate risk.
• C)credit risk.
• D)foreign exchange risk.
• E)off-balance-sheet risk.

---

Definitions:

Temperature

A measure of the thermal energy of a system, indicating how hot or cold it is.

Gas Particles

The small, discrete units that compose gases, moving freely and randomly and often described by the kinetic molecular theory.

Distances

Measurements of the space between two points, which can be measured in various units such as meters, miles, or light-years, depending on the context.

Gas Particles

The smallest constituents of a gas, moving freely and randomly, and obeying the gas laws.