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A Bank Has Three Assets

Question 21

Multiple Choice

A bank has three assets. It has $75 million invested in consumer loans with a three-year duration,$39 million invested in T-bonds with a 16-year duration,and $39 million in six-month maturity T-bills. What is the duration of the bank's asset portfolio in years?


A) 3.95 years
B) 4.83 years
C) 6.50 years
D) 7.38 years
E) 11.51 years

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