8-35 Because of Its Simplicity,smaller Depository Institutions Still Use This

question 49

Multiple Choice

8-35 Because of its simplicity,smaller depository institutions still use this model as their primary measure of interest rate risk.

• A)The repricing model.
• B)The maturity model.
• C)The duration model.
• D)The convexity model.
• E)The option pricing model.

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Definitions:

Budgeted Cash Receipts

An estimation of the cash a company expects to receive within a certain period, based on projected sales or revenue.

Budgeted Cash Disbursements

An estimate of the total amount of cash an organization plans to pay out over a specified period, including operating expenses and purchase of assets.

Direct Labor Budget

A financial plan that estimates the cost of direct labor required to meet production goals.

Direct Labor-Hours

A measure of the total time workers spend directly manufacturing a product or performing a service.