The repricing gap approach calculates the gaps in each maturity bucket by subtracting the
A)current assets from the current liabilities.
B)long term liabilities from the fixed assets.
C)rate-sensitive assets from the total assets.
D)rate-sensitive liabilities from the rate-sensitive assets.

Question

Quizplus · Accepted Answer

The repricing gap approach measures interest rate risk by comparing rate-sensitive assets and rate-sensitive liabilities within specific time buckets. The gap is calculated by subtracting rate-sensitive liabilities from rate-sensitive assets.

The Repricing Gap Approach Calculates the Gaps in Each Maturity