Which of the Following Statements About Leverage-Adjusted Duration Gap Is

question 47

Multiple Choice

Which of the following statements about leverage-adjusted duration gap is true?

• A)It is equal to the duration of the assets minus the duration of the liabilities.
• B)Larger the gap in absolute terms,the more exposed the FI is to interest rate shocks.
• C)It reflects the degree of maturity mismatch in an FI's balance sheet.
• D)It indicates the dollar size of the potential net worth.

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Definitions:

Fascicle

A bundle of muscle or nerve fibers bound together by connective tissue.

Epineurium

The outermost layer of connective tissue surrounding a peripheral nerve, providing both protection and support.

Peripheral Nerve

Peripheral nerves are the nerves outside the brain and spinal cord, responsible for relaying information between the central nervous system and the rest of the body.

Fascicles

Bundles of muscle or nerve fibers ensheathed by connective tissue.