HW_11_Questions_Chapters_24_25[1]

# HW_11_Questions_Chapters_24_25[1] - HW 11 Chapter 24...

This preview shows pages 1–3. Sign up to view the full content.

HW 11 Chapters 24, 25 Chapter 24 Quantitative Problems 10-11, 26 Chapter 25 Quantitative problems Questions 5-9, 28 1. In gap analysis, the gap is the difference between a bank's assets and liabilities. rate-sensitive assets and rate-sensitive liabilities rate-sensitive assets and fixed-rate assets. long-term and short-term securities. 2. If a bank has more rate-sensitive assets than liabilities, then a fall in interest rates will raise income. a rise in interest rates will lower income. a rise in interest rates will raise income. none of the above is true.

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
3. If a bank has an asset with a duration of 0.6 years and a value of \$8 million among total assets of \$100, then the weighted duration of the asset is 2.083 years. is 0.048 years. is 4.800 years. is 0.080 years. cannot be determined from the information given. 4. Suppose a bank has assets of \$150 million, liabilities of \$132 million, and a duration gap of 1.50. If interest rates fall from 10 percent to 5 percent, then the market value of net worth will fall by \$10.2 million.
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

### What students are saying

• As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

Kiran Temple University Fox School of Business ‘17, Course Hero Intern

• I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

Dana University of Pennsylvania ‘17, Course Hero Intern

• The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

Jill Tulane University ‘16, Course Hero Intern