Which of the following statements is falsea just as the, Ask an Expert

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Which of the following statements is false?

A) Just as the interest rate sensitivity of a single cash flow increases with its maturity, the interest rate sensitivity of a stream of cash flows increases with its duration.

B) A firm's market capitalization is determined by the difference in the market value of its assets and its liabilities.

C) We can measure a firm's sensitivity to interest rates by computing the duration of its balance sheet.

D) By restructuring the balance sheet to increase its duration, we can hedge the firm's interest rate risk

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91614176

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