Which of the following is a weakness of the repricing model to measure interest rate risk?
A) Potential for overaggregation of assets and liabilities within each maturity bucket.
B) It ignores how changes in interest rates affect the market value of assets and liabilities.
C) It ignores the reinvestment of loan interest and principal payments that are reinvested at current market rates.
D) It fails to recognize off-balance-sheet activities that may be rate sensitive.
E) All of these.
Correct Answer:
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Q67: An interest rate increase
A)benefits the FI by
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Q76: The repricing model ignores information regarding the
Q78: An increase in interest rates
A)increases the market
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A)Periodic cash flow of
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