Which of the Following Is Not a Weakness of Duration

question 25

Multiple Choice

Which of the following is not a weakness of duration gap analysis?

• A)It is difficult to accurately compute duration.
• B)Each future cash flow must be discounted by the appropriate future interest rate.
• C)The duration of a portfolio must be constantly monitored.
• D)It is difficult to estimate the duration on zero coupon bonds.
• E)All of the above are weaknesses of duration gap analysis.

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Definitions:

Contaminated Soil

Soil that has been polluted by hazardous substances, rendering it toxic to humans, animals, or plants.

Thermodynamics

The branch of physics that deals with the relationships between heat and other forms of energy, and the laws governing the conversion of heat into work.

Energy

The capacity to do work or produce change, existing in various forms such as kinetic, potential, thermal, and chemical energy.

Parts Per Trillion

A unit of measurement used to denote extremely small concentrations of a substance in another, equivalent to one part in 10^12 parts.