If a bank has a positive interest rate gap and interest rates decline, then the bank will experience a(n)

Name: If a bank has a positive interest rate gap and interest rates decline, then the bank will experience a(n)
Brand: Quizplus
Rating: 4.9 (48 reviews)

Question

Quizplus · Accepted Answer

A positive interest rate gap means the bank has more rate-sensitive assets than liabilities. If interest rates decline, the bank's revenue will decrease because the income from its assets will fall more than the cost of its liabilities.

If a Bank Has a Positive Interest Rate Gap and Interest