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A bank has liabilities of $4 million with an average maturity of two years paying interest rates of 4 per cent annually. It has assets
A bank has liabilities of $4 million with an average maturity of two years paying interest rates of 4 per cent annually. It has assets of $5 million with an average maturity of five years earning interest rates of 6 per cent annually. To what risk is the bank exposed? A. restructuring risk. B. refinancing risk and interest rate risk. C. refinancing risk. D. reinvestment risk and interest rate risk
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