Which of the Following Is True Regarding Duration Gap Analysis

question 17

Multiple Choice

Which of the following is true regarding duration gap analysis?

• A)The magnitude of the duration gap is related to the amount of interest rate risk a bank is subject to.
• B)Management can adjust the duration gap to speculate on future interest rate changes.
• C)A positive duration gap means a bank's market value of equity will decrease with an increase in interest rates.
• D)All of the above are true.
• E)a.and c.

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Definitions:

Compensatory Behaviors

Actions taken to counteract or make up for undesirable thoughts, feelings, or actions, commonly observed in disorders like bulimia nervosa.

Purging

In the context of eating disorders, engaging in behaviors to rid the body of consumed food or calories, such as via vomiting or excessive use of laxatives, often in an attempt to lose weight.

High-Intensity Exercise

A form of physical activity that involves vigorous bursts of activity followed by short recovery periods.

Compensatory Behavior

Actions taken to offset or make up for another behavior, often observed in the context of psychological disorders, such as eating disorders.