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A commercial bank tends to have long-term illiquid assets funded by short-term liabilities. To protect the equity value of the bank, a risk manager may

A commercial bank tends to have long-term illiquid assets funded by short-term liabilities. To protect the equity value of the bank, a risk manager may engage in which of the following?

A. A SWAP contract to pay floating and receive a fixed rate.

B. Buying a cap on interest rates.

C. Buy futures contracts on Treasury bonds..

D. None of the above.

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