Use the Following Table to Answer the Question

question 117

Multiple Choice

Use the following table to answer the question :

-Assuming that the average duration of its assets is four years,while the average duration of its liabilities is three years,then a 5 percentage point increase in interest rates will cause the net worth of First National to ________ by ________ of the total original asset value.

• A)decline;5 percent
• B)decline;10 percent
• C)decline;15 percent
• D)increase;20 percent

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Definitions:

Crowd

A temporary gathering of people in a public place; members might interact but do not identify with each other and will not remain in contact.

Aggregate

A collection or sum of many individual elements, items, or variables often used in the context of data analysis or statistics.

Category

A class or division of people or things regarded as having particular shared characteristics or attributes.

Authority

The right or power to enforce rules, judgments, or command influence over others.