Which of the Following Statements Is True

question 28

Multiple Choice

Which of the following statements is true?

• A)Convexity is desirable because the larger the convexity the greater the interest rate protection against interest rate decreases and the greater the potential gains following increasing interest rates.
• B)Convexity is desirable because the larger the convexity the greater the interest rate protection against interest rate rises and the greater the potential gains following decreasing interest rates.
• C)Convexity is undesirable because the larger the convexity the lower the interest rate protection against interest rate rises and the smaller the potential gains following decreasing interest rates.
• D)Convexity is undesirable because the larger the convexity the lower the interest rate protection against interest rate decreases and the smaller the potential gains following increasing interest rates.

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Definitions:

Social Pressures

The influence that is exerted on individuals or groups by others, often causing them to conform to certain behaviors or norms.

Family Structures

The composition and relationship dynamics within a family unit, including traditional, single-parent, blended, and other variations.

Evolve

The process of gradual development or change in something over time, often used to describe biological species but applicable to concepts and systems.

Cohabiting Man

A man living with his partner in a domestic partnership without being legally married to them.