The assets and liabilities of Finacle Bank as on December 31,2015,are as follows:
$20,000 of short-term securities issued by governments and private borrowers (about to mature),$12,000 of borrowings from the money market,$15,000 of short-term savings accounts,$12,000 of variable-rate loans and securities,$18,000 of long-term loans made at a fixed interest rate,$25,000 of long-term savings and retirement accounts,$22,000 of deposits in the Central Bank (held as legal reserves),$550,000 of equity capital provided by the bank's owners,and $500,000 of building and equipment.
Which of the following is a repriceable liability for Finacle Bank?
A)Long-term savings and retirement accounts
B)Variable-rate loans and securities
C)Borrowings from the money market
D)Equity capital provided by the owners
E)Long-term loans made at a fixed interest rate

Question

Quizplus · Accepted Answer

Borrowings from the money market are typically repriceable liabilities, meaning that their interest rates can change over time. This is in contrast to long-term savings and retirement accounts, which have a fixed interest rate, variable-rate loans and securities, which have interest rates that fluctuate based on market conditions, and equity capital provided by the owners, which represents the bank's ownership stake and does not have an interest rate. Long-term loans made at a fixed interest rate also do not have a repricing feature, as the interest rate remains the same throughout the life of the loan.

The Assets and Liabilities of Finacle Bank as on December