If Depositors Move Money from Their Checking Account to Short-Term

question 2

Multiple Choice

If depositors move money from their checking account to short-term CDs, this would ____ the rate-sensitivity of the savings institution's liabilities to interest rate movements.

• A)increase
• B)have no effect on
• C)decrease
• D)A or C, depending on the size of the savings institution

---

Definitions:

Quantifier Negation

The process of changing the quantifier in a statement, such as from "all" to "not all," to negate its original meaning.

Universal Generalization

A principle of deductive reasoning that allows one to conclude that something is true for all cases after confirming it is true in every observed case.

Existential Instantiation

A logical principle that states from the knowledge that something exists, one can infer the existence of an instance of that thing.

Universal Instantiation

A logical rule that allows one to deduce that a statement applies to specific instances given it holds for all instances.