One Problem with Duration Gap Analysis Is That It

question 41

Multiple Choice

One problem with duration gap analysis is that it

• A) is calculated assuming that the yield curve is flat.
• B) is calculated assuming that the yield curve does not change.
• C) does not measure the sensitivity of net worth to interest rate changes.
• D) does not measure the sensitivity of income to interest rate changes.
• E) applies only to financial institutions.

---

Definitions:

Fatalistic

Pertaining to the belief that all events are predetermined and therefore inevitable, leading to a resignation to outcomes.

Resigned Attitude

A psychological state where an individual accepts a situation or condition as inevitable, often with a sense of powerlessness.

Criticisms

The expression of disapproval based on perceived faults or mistakes, or the analysis and judgment of the merits and faults of a literary or artistic work.

Cultural Capital

The non-financial social assets that promote social mobility beyond economic means, including education, intellect, style of speech, and appearance.