Which of the Following Would Require a Short Hedge

question 25

Multiple Choice

Which of the following would require a short hedge?

• A) The bank anticipates a decline in interest rates.
• B) The bank has a positive GAP.
• C) The bank is liability sensitive.
• D) All of the above require a short hedge.
• E) None of the above require a short hedge.

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Definitions:

Typical

Characteristic of a particular person, group, situation, or thing; representing the usual or most common example.

Disinherited

The act of intentionally preventing someone from receiving inheritance or property from a will or estate.

Entire Estate

Refers to all the assets owned by an individual at the time of their death, including property, investments, and personal belongings.

Validity

Validity refers to the extent to which a concept, conclusion or measurement is well-founded and likely corresponds accurately to the real world.