What is the change in the value of its assets if all interest rates decrease by 1 percent?
A)Approximately $1.613 million.
B)Approximately $2.297 million.
C)Approximately -$1.937 million.
D)Approximately $2.209 million.
E)Approximately $2.524 million.
[Refer to: 8-113]

Question

Quizplus · Accepted Answer

The correct answer is determined by calculating the change in the value of assets due to a 1 percent decrease in interest rates, typically using the duration or convexity method to estimate the impact on bond prices or other interest-sensitive assets. The specific value of approximately $2.297 million suggests a calculation based on the specific characteristics of the assets in question, such as their duration, yield, and the size of the interest rate change.

What Is the Change in the Value of Its Assets