Which of the Following Statements Is FALSE

question 29

Multiple Choice

Which of the following statements is FALSE?

• A) We can access a firm's sensitivity to interest rates by examining its balance sheet.
• B) Just as the interest rate sensitivity of a single cash flow increases with its maturity, the interest rate sensitivity of a stream of cash flows increases with its duration.
• C) By restructuring the balance sheet to increase its duration, we can hedge the firm's interest rate risk.
• D) A firm's market capitalization is determined by the difference in the market value of its assets and its liabilities.

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Definitions:

Satisfactory

Adequate or meeting the basic requirements; acceptable though not outstanding or excellent.

Age

The length of time that a person or organism has been alive or the period during which an object has existed.

Physical Assessment

A comprehensive examination of a patient's body to identify any signs of disease, abnormalities, or health concerns.

Option

A choice or preference among a variety of alternatives.