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:

Process

A series of actions or steps taken to achieve a particular end, often involving a methodical or systematic approach.

Interests

Activities, subjects, or pursuits that a person finds enjoyable or thinks are important.

Positively Affected

Influenced in a beneficial way.

Role

The expected behavior or function of an individual within a specific context, such as a social or professional setting.