If a Financial Institution Has Equated the Dollar Effects of Interest

question 6

Multiple Choice

If a financial institution has equated the dollar effects of interest rate risk on the assets with the dollar effects on the 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 the above.

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Definitions:

Psychodynamic

The psychodynamic approach in psychology emphasizes systematic study of the psychological forces that underlie human behavior, feelings, and emotions and how they might relate to early experience.

Hereditability

A measure of how well differences in people's genes account for differences in their traits.

Unconscious

The part of the mind that contains thoughts, memories, and desires not currently in focal awareness but can influence behavior.

Social Cognitive View

A psychological perspective emphasizing the role of observational learning, imitation, and modeling in behavior, influenced by interactions with others and the environment.