For a Bank That Has a Positive Duration Gap, an Increase

question 23

Multiple Choice

For a bank that has a positive duration gap, an increase in interest rates will cause a(n) _______ in the economic value of assets, a(n) _______ in the economic value of liabilities, and a(n) _______ in the economic value of equity.

• A)increase, decrease, increase
• B)increase, increase, decrease
• C)increase, increase, increase
• D)decrease, decrease, increase
• E)decrease, decrease, decrease

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Definitions:

Electrocardiogram Monitor

A device used to record the electrical activity of the heart over a period of time, detecting cardiac abnormalities.

Palpitations

The sensation of having rapid, fluttering, or pounding heartbeats.

Chest Tube

A tube inserted through the chest wall to remove air, fluid, or pus from the pleural space.

Maintain Chest Tube Function

The practice of ensuring the proper operation and condition of a chest tube to drain air, blood, or fluids from the pleural space.