If the interest rate on a bank's liabilities rises without an increase in asset interest rates, the bank's:
A)equity ratio falls.
B)return on assets rises.
C)profits fall.
D)All of the Answer s are correct.

Question

Quizplus · Accepted Answer

When the interest rate on a bank's liabilities rises without a corresponding increase in asset interest rates, the bank's interest expenses increase, leading to a decrease in profits.

If the Interest Rate on a Bank's Liabilities Rises Without