Which of the following statements is FALSE?
A) We can access a firm's sensitivity to interest rates by examining its balance sheet.
B) 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.
C) By restructuring the balance sheet to increase its duration, we can hedge the firm's interest rate risk.
D) A firm's market capitalization is determined by the difference in the market value of its assets and its liabilities.
Answer: C
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