All Other Things Being Equal, If a Bank Borrows Short

question 524

Multiple Choice

All other things being equal, if a bank borrows short and lends long what is the effect on the liquidity risk of the bank?

• A) positive
• B) changes only when interest rates levels are high
• C) negative
• D) changes only when interest rates levels are low

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Definitions:

Registered Nurse

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A chemical element, symbol Na, essential for human health, playing a key role in nerve function and fluid balance but excessive intake can lead to health issues.