What Would Happen to a Bank's Net Interest Income If

question 351

Multiple Choice

What would happen to a bank's net interest income if it ran a zero gap in an environment of decreasing interest rates?

• A) Net interest income would increase slightly.
• B) Net interest income would increase considerably.
• C) Net interest income would decrease.
• D) Net interest income would hardly change at all.

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Definitions:

Rearrangements

A type of chemical reaction in which the structure of a molecule is rearranged to form a new structure.

Rate

A measure of how fast or slow a chemical reaction occurs.

Dehydration

The chemical process by which a molecule of water is removed from the reactants to form the product.

Sulfuric Acid

A highly corrosive strong mineral acid with the molecular formula H2SO4, widely used in industry and manufacturing.