Keeping all other factors constant, banks can reduce the volatility of net interest income by:
A) adjusting the dollar amount of rate-sensitive assets.
B) adjusting the dollar amount of fixed-rate liabilities.
C) using interest rate swaps.
D) Bank can reduce volatility of net interest income by doing all of the above.
E) a. and c. only
Correct Answer:
Verified
Q6: Interest rate risk:
A) varies inversely with a
Q7: A bank's cumulative GAP:
A) is defined as
Q9: When is interest rate risk for a
Q10: If rate-sensitive assets equal $600 million and
Q12: If a bank has a negative GAP,
Q13: A bank's periodic GAP:
A) is defined as
Q14: If rate-sensitive assets equal $500 million and
Q15: Put the following steps for conducting a
Q16: If rate-sensitive assets equal $500 million and
Q93: A bank has a 1-year $1,000,000 loan
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