Immunizing the balance sheet to protect equity holders from the effects of interest rate risk occurs when Group of answer choices the effect of a change in the level of interest rates on the value of the assets of the FI is exactly offset by the effect of the same change in interest rates on the liabilities of the FI. the repricing gap is zero, so that all assets have a matching liability that reprices at the same time. the modified duration gap of the balance sheet is zero. the maturity gap is zero, so that all assets have a matching-maturity liability. the modified duration is equal to the dollar duration.

Stocks a, b, and c are similar in some respects: each has an expected return of 10% and a standard deviation of 25%. stocks a and b have returns that are independent of one another; i.e., their correlation coefficient, r, equals zero. stocks a and c have returns that are negatively correlated with one another; i.e., r is less than 0. portfolio ab is a portfolio with half of its money invested in stock a and half in stock b. portfolio ac is a portfolio with half of its money invested in stock a and half invested in stock c. which of the following statements is correct? a. portfolio ab has a standard deviation that is greater than 25%.b. portfolio ac has an expected return that is less than 10%.c. portfolio ac has a standard deviation that is less than 25%.d. portfolio ab has a standard deviation that is equal to 25%.e. portfolio ac has an expected return that is greater than 25%.