Which of the Following Is False Regarding Duration Gap Analysis

question 21

Multiple Choice

Which of the following is false regarding duration gap analysis?

• A) Duration gap analysis does not classify assets as rate-sensitive.
• B) Duration gap analysis indicates the potential change in a bank's net interest income.
• C) Duration gap accounts for bank leverage.
• D) Duration gap accounts for the present value of cash flows associated with all liabilities.
• E) Duration gap analysis indicates the potential change in a bank's market value of equity.

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