Question

Assume that the value of liabilities equals that of earning assets. If asset portfolio durations are ____ than liability portfolio durations, then the market value of assets are ____ interest-rate sensitive than the market value of liabilities.

Answer 1

Lower, less

Explanation:

The market value of debts is referred to as the market value of that is different in book value and the reference sheet. The company debts always not come in the form of public-ally traded bonds. The book value of a company has been compared with the balance sheet. The book value of a company does not include accounts payable and the liabilities of a company. The example of flows of cash are :

• Coins

• Currency

• Cash in checking accounts