The Following Information Is About Current Spot Rates for Second

question 2

Multiple Choice

The following information is about current spot rates for Second Duration Savings' assets (loans) and liabilities (CDs) . All interest rates are fixed and paid annually.
-If the FI finances a $500,000 2-year loan with a $400,000 1-year CD and equity,what is the leveraged adjusted duration gap of this position? Use your answer to the previous question.

• A)+1.25 years
• B)+1.12 years
• C)-1.12 years
• D)+0.92 years

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