A Bank Has Made Long Term Fixed Rate Mortgages and Has

question 40

Multiple Choice

A bank has made long term fixed rate mortgages and has financed them with short term deposits.To hedge out the bank's interest rate risk they could ________.

• A) sell T-bond futures
• B) buy T-bond futures
• C) buy stock index futures
• D) sell stock index futures

---

Definitions:

Socioeconomic Status

An individual's or group's economic and social position in relation to others, based on income, education, and occupation.

Middle Eastern Immigrants

Individuals who have migrated from Middle Eastern countries to different parts of the world, bringing their cultural, religious, and social traditions into the host societies.

Ethnic Enclaves

Geographically defined areas with high ethnic concentration, characterized by cultural distinction from the larger surrounding area.

Poverty Rates

Poverty rates indicate the percentage of the population living below the poverty line, a threshold which varies by country and is used to measure economic hardship.