Oceania Bank has financial assets of $730 and equity of $328.5. If the duration of assets is 6.52 years and the duration of all liabilities is 1.39 years, what is the leverage adjusted duration gap? A. 5.7555 years B. 5.8945 years C. 5.1799 years D. 6.4840 years E. Cannot be determined

Oceania Bank has financial assets of $730 and equity of $328.5. If the duration of assets is 6.52 years and the duration of all liabilities is 1.39 years, what is the leverage adjusted duration gap? A. 5.7555 years B. 5.8945 years C. 5.1799 years D. 6.4840 years E. Cannot be determined

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Question

Oceania Bank has financial assets of $730 and equity of $328.5. If the duration of assets is 6.52 years
and the duration of all liabilities is 1.39 years, what is the leverage - adjusted duration gap? A. 5.7555
years
B. 5.8945 years C. 5.1799 years D. 6.4840 years E. Cannot be determined

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