Which of the following balance sheet entries is not sensitive to changes in market interest rates?
A) bonds
B) reserves
C) mortgages
D) borrowings

Question

Quizplus · Accepted Answer

Reserves are not directly sensitive to changes in market interest rates because they represent funds set aside by a company for specific purposes or as a cushion against future liabilities or losses, and their value does not fluctuate with market interest rates. In contrast, the value of bonds, mortgages, and borrowings can be directly impacted by changes in market interest rates.

Which of the Following Balance Sheet Entries Is Not Sensitive