When Interest Rates Increase the Building Societies Record ________ in the Interest

question 23

Multiple Choice

When interest rates increase the building societies record ________ in the interest costs on their short-term liabilities and ____________ in the interest income of the fixed rate long-term residential loans.

• A)an increase; an increase
• B)no change; an increase
• C)an increase; no change
• D)a decrease; no change

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Definitions:

Dummy Variables

Variables created to include categorical data in regression models, converting categories to a numerical form.

Confidence Intervals

Ranges within which a population parameter is estimated to lie with a certain level of confidence, often used to indicate the reliability of an estimate.

Regression Coefficients

Parameters in a regression model that quantify the relationship between the dependent variable and each of the independent variables.

Sampling Error

The discrepancy between the statistical characteristics of a sample and those of the entire population, arising purely from the randomness of the sample selection.