The majority of maturities on consumer loans offered by credit unions are ____ term, causing income generated on their asset portfolio to be ____ to interest rate movements.
A)long; insensitive
B)short or medium; sensitive
C)long; sensitive
D)short or medium; insensitive

Question

Quizplus · Accepted Answer

Credit unions typically offer consumer loans with short or medium terms, which makes the income generated on their asset portfolio sensitive to interest rate movements. Shorter-term loans are more frequently affected by changes in interest rates compared to longer-term loans, as they are often subject to refinancing or renewal at current market rates.

The Majority of Maturities on Consumer Loans Offered by Credit