An FI's Balance Sheet Is Characterized by Long-Term Fixed-Rate Assets

question 32

Multiple Choice

An FI's balance sheet is characterized by long-term fixed-rate assets funded by short-term variable-rate securities. Most likely the bank has a

• A)positive repricing gap and a positive duration gap.
• B)positive repricing gap and a negative duration gap.
• C)negative repricing gap and a positive duration gap.
• D)negative repricing gap and a negative duration gap.
• E)None of the options are correct.

---

Definitions:

Personal Defense

A liability defense that is not applicable to holders in due course.

Misappropriation

The unauthorized use of another's name, likeness, or property without permission, typically for one's own benefit.

Endorse

means to give public support, approval, or recommendation to something or someone, often seen in the context of celebrities endorsing products or political figures.

Check

A written, dated, and signed instrument that directs a bank to pay a specific sum of money to the bearer.