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41. A bank has an average asset duratinn of 1.15 years and an average liability duration of 2.?5 years. This bank has $255 million in
41. A bank has an average asset duratinn of 1.15 years and an average liability duration of 2.?5 years. This bank has $255 million in total assets and $225 million in total liabilities. This bank has A) A negative duration gap of 1.55 years 13} A positive duration gap of 1.25 years C) A negative duration gap of 3.55 years D) A negative duration gap of 1.25 years 42. A bond has a duration of 2.5 years. Its current market price is $1,125. Interest rates in the market are 2'55 today. It has been forecasted that interest rates will rise to 5% over the next couple of weeks. How will this bond price change in percentage terms? A) Its price will fall by 14.52% 5} Its price will rise by 14.52% C) Its price will fall by 2% D) Its price will rise by 255 45. A bank has an average asset duration of 5 years and an average liability duration of 3 years. This bank has total assets of $555 million and total liabilities of $255 million. Currently, market interests are 1555. If interest rates fall to 5%, what is this bank's change in net worth? A) Net worth will decrease by $51.52 million 5) Net worth will increase by $51.52 million (3) Net worth will not change at all D) Net worth will decrease by $15.51 million 44. 1|iiihich of the following situation creates the most liquidity risk? A) Long-term assets funded by shun-term liabilities B} Short-tenn assets funded by short-tenn liabilities C) Long-term assets funded by long-tenn liabilities lT't Rhnrt-ter-m aesnte fnnrlerl law inner-term liabilities
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