If a Bank Has ________ Rate-Sensitive Assets Than Liabilities,then ________

question 120

Multiple Choice

If a bank has ________ rate-sensitive assets than liabilities,then ________ in interest rates will increase bank profits.

• A)more;a decline
• B)more;an increase
• C)fewer;an increase
• D)fewer;a surge

---

Definitions:

Foreign Currency

Currency used in a country other than one's own, involved in international trade and investing.

Exchange Rate Risk

The potential for investors to experience losses due to changes in the exchange rate between currencies.

Forward Contracts

Customizable financial contracts traded over-the-counter between two parties to buy or sell an asset at a specified future date for a price agreed upon today.

Economic Conditions

The state of an economy at a given time, encompassing factors like inflation, unemployment, and GDP growth.