If a Bank Has a Duration Gap of Two Years,a

question 75

Multiple Choice

If a bank has a duration gap of two years,a fall in interest rates from 5% to 8% per annum will lead to a/an:

• A) increase of 5.71% in the market value of its net worth.
• B) fall of 5.71% in the market value of its net worth.
• C) increase of 5.71% in net interest income.
• D) fall of 5.71% in net interest income.

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Definitions:

Organizational Culture

The set of shared values, beliefs, behaviors, and practices that characterizes an organization, influencing how people interact and work together within it.

Organizational Socialization

The process by which a new employee learns the organizational values, norms, and required behaviors which permit him to participate as a member of the organization.

Employees

Individuals who are hired by an organization to perform specific duties and tasks in exchange for compensation.

Organizational Socialization

This is the process by which new employees learn the values, norms, and required behaviors which permit them to participate as members of an organization.