Multiple Choice
Which of the following statements concerning a bank's leverage-adjusted duration gap is true?
A) If it has a positive duration gap and interest rates rise,its net worth will decline.
B) If it has a positive duration gap and interest rates fall,its net worth will decline.
C) If it has a negative duration gap and interest rates rise,its net worth will decline.
D) If it has a negative duration gap and interest rates fall,its net worth will increase.
E) All of the options are correct.
Correct Answer:
Verified
Correct Answer:
Verified
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