The Duration Gap Can Be Used to Measure How Changes

question 62

Multiple Choice

The duration gap can be used to measure how changes in the interest rate affect an FI's:

• A)net worth
• B)maturity gap strategy
• C)liquidity strategy
• D)All of the listed options are correct.

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Definitions:

Phosphine

A toxic, colorless, flammable gas with the chemical formula PH3, used in the semiconductor industry and as a pesticide.

Triangular Pyramid

A geometric solid with a triangular base and three faces that are also triangles, meeting at a single point called the apex.

Ammonia

A compound of nitrogen and hydrogen with the formula NH3, known for its sharp, pungent odor and use in fertilizers and cleaning products.

Electron Density

A measure of the probability of an electron being present at a specific location around an atom or molecule.