True or False. State whether the last sentence is true or false.

(a) A portfolio that is long $50M of bonds with a duration of 10 years and has a liability of $100M with a duration of 5 years will be well-hedged and have low interest rate risk.

(b) When a bond trades at a positive spread relative to a given term structure (such as the Treasuryimplied rates), the cash flows of that bond should be discounted at rates above that those given by that term structure.

(c) When the forward price is above the spot price, the long side of the forward will make money on average.

(d) When there is no benefit (such as a dividend) or cost (such as a storage cost) to owning an asset relative to having the promise of ownership of an asset, we can replicate a forward contract by (i) buying the asset, (ii) taking a loan to finance the purchase, and (iii) storing the asset.