The difference of rate-sensitive liabilities and rate-sensitive assets is known as the
A)duration.
B)interest-sensitivity index.
C)rate-risk index.
D)gap.

Question

Quizplus · Accepted Answer

The difference between rate-sensitive liabilities and rate-sensitive assets is known as the gap. The gap analysis measures the bank's sensitivity to interest rate changes, and it helps the bank to manage its interest rate risk. Thus, Gap is the best choice for this question.

The Difference of Rate-Sensitive Liabilities and Rate-Sensitive Assets Is Known