For most banks, the average duration of assets ____ the average duration of liabilities, so the duration gap is ____.
A)exceeds; zero
B)exceeds; negative
C)exceeds; positive
D)is less than; negative

Question

Quizplus · Accepted Answer

The average duration of assets typically exceeds the average duration of liabilities for most banks, resulting in a positive duration gap. This means that the assets, on average, have a longer time to maturity than the liabilities.

For Most Banks, the Average Duration of Assets ____ the Average