If Interest Rates Decrease 50 Basis Points for an FI

question 74

Multiple Choice

If interest rates decrease 50 basis points for an FI that has a gap of +$5 million, the expected change in net interest income is

• A)+ $2,500.
• B)+ $25,000.
• C)+ $250,000.
• D)- $250,000.
• E)- $25,000.

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Definitions:

Azores

A group of nine volcanic islands situated in the North Atlantic Ocean and is an autonomous region of Portugal.

Magnetic Fields

Invisible fields that exert force on objects that possess magnetic properties, including electrically charged particles and magnetic materials, fundamental to electromagnetism.

Navigational Instruments

Tools used by navigators to find their way when traveling over water or through the air, including compasses, sextants, and GPS devices.