When an FI Pre-Commits to Lending at a Fixed Rate

question 110

Multiple Choice

When an FI pre-commits to lending at a fixed rate, it is exposed to

• A)credit risk.
• B)interest rate risk.
• C)takedown risk.
• D)funding risk.
• E)exchange rate risk.

---

Definitions:

Unfreezing

The initial phase in the change process where old habits or structures are dismantled to accept new ways of thinking.

Social Psychologist

A specialist who studies how individual behavior and mental processes are influenced by social interactions and societal factors.

Kurt Lewin

A pioneering psychologist known for his contributions to social psychology, organizational development, and leadership theories.

Stagnation

A state of inactivity or lack of growth and development, often leading to decreased productivity and innovation.