Multiple Choice
Which of the following is true regarding duration gap analysis?
A) The magnitude of the duration gap is related to the amount of interest rate risk a bank is subject to.
B) Management can adjust the duration gap to speculate on future interest rate changes.
C) A positive duration gap means a bank's market value of equity will decrease with an increase in interest rates.
D) All of the above are true.
E) a. and c.
Correct Answer:
Verified
Correct Answer:
Verified
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