Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Which of the following statements is FALSE? A. According to the CGAP effect, when CGAP is positive the change in net interest income is positively

Which of the following statements is FALSE?

A.

According to the CGAP effect, when CGAP is positive the change in net interest income is positively related to the change in interest rates.

B.

The maturity bucket is the time window over which the dollar amounts of assets and liabilities are measured.

C.

If an FI wants to increase its repricing gap, it can replace its equity with demand deposits.

D.

The repricing gap is a measure of the difference between the dollar value of assets that will reprice and the dollar value of liabilities that will reprice within a specific time period

E.

If an FI wants to increase its repricing gap, it can replace fixed-rate loans with rate-sensitive loans.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Overcoming Debt Achieving Financial Freedom

Authors: Cindy Zuniga-Sanchez

1st Edition

1119902320, 978-1119902324

More Books

Students also viewed these Finance questions