An FI That Finances Long-Term Fixed Rate Mortgages with Short-Term

question 35

Multiple Choice

An FI that finances long-term fixed rate mortgages with short-term deposits is exposed to

• A)increases in net interest income and decreases in the market value of equity when interest rates fall.
• B)decreases in net interest income and decreases in the market value of equity when interest rates fall.
• C)decreases in net interest income and decreases in the market value of equity when interest rates rise.
• D)increases in net interest income and decreases in the market value of equity when interest rates rise.
• E)increases in net interest income and increases in the market value of equity when interest rates rise.

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Definitions:

Alcohol Abuse

The harmful use of alcohol that leads to negative health, social, legal, or personal consequences.

Alcoholics Anonymous

A fellowship of individuals who share their experience, strength, and hope with each other to solve their common problem and help others recover from alcoholism.

Ageism

Prejudice or discrimination on the basis of a person's age, often directed towards older adults.

Risk For Suicide

A state in which an individual has signs, symptoms, or conditions that indicate a significant risk of attempting to take one’s own life.