A balance sheet hedge requires that the amount of exposed foreign currency assets and liabilities:
A) have a 2:1 ratio of assets to liabilities.
B) have a 2:1 ratio of liabilities to assets.
C) have a 2:1 ratio of liabilities to equity.
D) be equal.
Answer: D
Business
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As manager, you would like to maintain the portfolio's dollar duration at the initial level by rebalancing the portfolio. You choose to rebalance using the existing security proportions of one-third each. Calculate:
A. the dollar durations of each of the bonds. B. the rebalancing ratio necessary for the rebalancing. C. the cash required for the rebalancing.
Business
An unproven statement or proposition about a factor or phenomenon that is of interest to the researcher is called a theory
Indicate whether the statement is true or false
Business