If a Financial Organisation Has a Repricing Gap Equal to a Negative

question 45

Multiple Choice

If a financial organisation has a repricing gap equal to a negative $30 million,a 500 basis point drop in interest rates will cause profits to:

• A) rise by $15 million.
• B) rise by $1.5 million.
• C) fall by $15 million.
• D) fall by $1.5 million.

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Definitions:

Emotional Distress

A legal term for the mental anguish or suffering one may experience as a result of another's actions or negligence.

Strictly Liable

Having legal responsibility for damages or loss, regardless of care or intent.

Hot Dog

A cooked sausage, traditionally grilled or steamed and served in a sliced bun as a sandwich.

Duty of Care

Legal obligation to act with a level of caution and attention to prevent harm to others.