A Risk Manager Could Restructure Assets and Liabilities to Reduce

Multiple Choice

A risk manager could restructure assets and liabilities to reduce interest rate exposure for this example by

A) increasing the average duration of its assets to 9.56 years.
B) decreasing the average duration of its assets to 4.00 years.
C) increasing the average duration of its liabilities to 6.78 years.
D) increasing the average duration of its liabilities to 9.782 years.
E) increasing the leverage ratio, k, to 1.
[Refer to: 9-121]