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If a bank is characterized by a positive income gap and interest rates rise, what will happen? What will happen if the bank is characterized
If a bank is characterized by a positive income gap and interest rates rise, what will happen? What will happen if the bank is characterized by a negative income gap and interest rates rise? How would your answer to these questions change if we assumed that interest rates were falling? How can banks insulate themselves from the threat posed by volatile interest rates on bank income?
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