If a Financial Institution Has Equated the Dollar Effects of Interest

question 4

Multiple Choice

If a financial institution has equated the dollar effects of interest rate risk on its assets with the dollar effects on its liabilities,it has engaged in:

• A) a long hedge.
• B) a short hedge.
• C) a protected swap.
• D) immunizing interest rate risk.
• E) None of these.

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Definitions:

Personality Differences

variations among individuals in terms of traits, behaviors, and patterns of thinking and feeling, which distinguish one person from another.

Overlook

To fail to notice or deliberately ignore something, potentially missing important information or details.

Hear

To perceive with the ear the sound made by (someone or something).

Robust Dimensions

Refers to the characteristic or attribute of a system, process, or product that maintains its functionality under various conditions, denoting strength and reliability.