To Use the Concept of Duration to Analyze the Effect

question 48

Multiple Choice

To use the concept of duration to analyze the effect of changes in interest rates on the market value of an asset,a bank manager would multiply

• A) the negative of the duration of the asset by the change in the interest rate, ?i.
• B) the negative of the duration of the asset by ?i /(1 + i).
• C) the duration of the asset by the change in the interest rate, ?i.
• D) the duration of the asset by ?i /(1 + i).

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Definitions:

Code of Ethics

A set of principles and rules used by individuals and organizations to govern their decision-making process in a way that is consistent with moral and ethical standards.

Ethical Dilemma

A situation where an individual faces a decision between two morally right or wrong choices, with no clear right or wrong answer.

Gender

A social construct that encompasses a range of identities, expressions, and roles often associated with being male, female, a blend of both, or neither, and is influenced by social and cultural norms.

Racial Discrimination

Racial Discrimination is the unfair treatment of individuals based on their race, characterized by exclusion, restrictions, or preference that hampers equality of opportunity.