Which of the Following Will Not Affect a Bank's Duration

question 9

Multiple Choice

Which of the following will not affect a bank's duration estimate for the year?

• A) Prepayments on loans that exceed expectations.
• B) A 20-year corporate bond that is unexpectedly called in 6 months.
• C) Certificates of deposit that are withdrawn early.
• D) Holding a 30-year Treasury bond until maturity.
• E) All of the above will affect a bank's estimated duration for the year.

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Definitions:

Future Outcomes

Potential results or consequences of actions taken in the present or decisions made considering future possibilities and uncertainties.

Organizations

Groups or structures created to achieve specific goals through collective effort.

Collectivist Cultures

Societies that emphasize the needs and goals of the group as a whole over the needs and desires of each individual, fostering strong family or group ties.

Flexible Benefit Programs

Employee benefits plans that allow individuals to choose from a range of benefit options, tailored to their personal needs and preferences.