If a Bank Has $50 Million in Rate-Sensitive Assets and $20

question 105

Multiple Choice

If a bank has $50 million in rate-sensitive assets and $20 million in rate-sensitive liabilities then

• A)an increase in interest rates will reduce bank profits.
• B)a decrease in interest rates will reduce bank profits.
• C)interest rate changes will not impact bank profits.
• D)a decrease in interest rates will increase bank profits.

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Definitions:

Cost of Production Report

A document that details the total cost and production quantities of a manufacturing process or department, crucial for cost management and control.

Operations

The day-to-day activities necessary for running a business and producing goods or services.

First-in, First-out Method

An inventory valuation method where the first items purchased or produced are the first ones to be sold or used, affecting the cost of goods sold and ending inventory valuation.

Bottling Department

A specific production area within a manufacturing facility focused on the filling, sealing, and packaging of beverages into bottles.