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4. Interest rate risk: Gap analysis vs duration analysis Which of the following accurately defines
duration analysis? The difference between the amount of Mabilities and the amount of assets an
which interest rates are due to reset during a specific timeperiod The weighted average of time
until repayment of the price of a bond for a bond with a fixed cash flow What information do
bank managers need to perform duration analysis? check ail that apply. The capacity of their
depositors Market values of assets and liabilities Comprehensive credit reports on their long-term
borrowers The weighted average of times until payment as a function of the present value of the
payment Which of the following best describes the difference between duration analysis and
interest rate gap analysis? Duration analysis overlooks the fact that sometimes the amount of
income rate-sensitive assets can excess the amount of income ratesensitive liabilities. Unlike
interest rate gap analysis, duration analysis does not take into account thit some assets or
liabilities are mace sensitive to interest rate changes. Duration analysis ignores the fact that the
weighted average of times untll payment can be zero. Unlike interest rate gap analysis, duration
analysis takes into account that some assets or liabilities are more sensitive to interent rate
changes.

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4- Interest rate risk- Gap analysis vs duration analysis Which of the.docx

  • 1. 4. Interest rate risk: Gap analysis vs duration analysis Which of the following accurately defines duration analysis? The difference between the amount of Mabilities and the amount of assets an which interest rates are due to reset during a specific timeperiod The weighted average of time until repayment of the price of a bond for a bond with a fixed cash flow What information do bank managers need to perform duration analysis? check ail that apply. The capacity of their depositors Market values of assets and liabilities Comprehensive credit reports on their long-term borrowers The weighted average of times until payment as a function of the present value of the payment Which of the following best describes the difference between duration analysis and interest rate gap analysis? Duration analysis overlooks the fact that sometimes the amount of income rate-sensitive assets can excess the amount of income ratesensitive liabilities. Unlike interest rate gap analysis, duration analysis does not take into account thit some assets or liabilities are mace sensitive to interest rate changes. Duration analysis ignores the fact that the weighted average of times untll payment can be zero. Unlike interest rate gap analysis, duration analysis takes into account that some assets or liabilities are more sensitive to interent rate changes.