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1. If you are a banker and expect interest rates to rise in the future, would you want to make short-term or long-term loans? 2.

1. If you are a banker and expect interest rates to rise in the future, would you want to make short-term or long-term loans?

2. If a bank doubles the amount of its capital and ROA stays constant, what will happen to ROE?

3. If a bank is falling short of meeting its capital requirements by $1m, what three things can it do to rectify the situation?

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