How Can a Negative Duration Gap of 0

question 30

Multiple Choice

How can a negative duration gap of 0.21 years be interpreted?

• A)The FI is exposed to decreasing interest rates because it has a negative duration gap of 0.21 years.
• B)The FI is exposed to increasing interest rates because it has a negative duration gap of 0.21 years.
• C)The FI is not exposed to interest rate changes since it is running a matched book.
• D)The FI's exposure will depend on its maturity gap.

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Definitions:

Dual-Employed

Pertaining to households or partnerships where both members are engaged in paid employment.

Authoritarian Parenting

A strict parenting style characterized by high demands and low responsiveness, where obedience from the child is expected without much open dialogue or nurturing.

Demanding

Requiring much time, effort, or attention, often in a way that is seen as challenging.

Punitive

Relating to or intended for punishment.