Macon Bank has interest revenues of $4 million, interest expenses of $5 million, and assets totaling $20 million. Macon Bank's net interest margin is

Question

Quizplus · Accepted Answer

Net interest margin is calculated as (Interest Revenue - Interest Expenses)/Total Assets.

So, plugging in the values, we get:

Net interest margin = ($4 million - $5 million)/$20 million = -$1 million/$20 million = -0.05 = -5%

Therefore, the answer is D.

Macon Bank Has Interest Revenues of $4 Million, Interest Expenses