For a Bank with a Positive Duration Gap,an Increase in Interest

question 48

Multiple Choice

For a bank with a positive duration gap,an increase in interest rates will

• A)increase the likelihood of insolvency.
• B)decrease the likelihood of insolvency.
• C)not affect the likelihood of insolvency.
• D)result in increased loan trading.
• E)None of the options are correct.

---

Definitions:

Drive Axle Tires

Tires mounted on the drive axle of a vehicle, designed to provide traction and transmit power from the drivetrain to the ground.

Traction

The frictional force between a vehicle's tires and the surface it is on, allowing the vehicle to move forward or stop.

Air System Components

Parts of an air system, including compressors, valves, sensors, and hoses, that work together to manage and control air flow.

Methyl Hydrate

A solvent commonly known as methanol or wood alcohol, used in a variety of applications from antifreeze to fuel.