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If a bank has short-term deposits and provides long-term fixed rate loans, and i

ID: 2697903 • Letter: I

Question

If a bank has short-term deposits and provides long-term fixed rate loans, and interest rates decline over time, its net interest margin should be: Answer Declining over time. Rising over time. Constant over time. Consistently negative. If a bank has short-term deposits and provides long-term fixed rate loans, and interest rates decline over time, its net interest margin should be: Declining over time. Rising over time. Constant over time. Consistently negative. Declining over time. Rising over time. Constant over time. Consistently negative.

Explanation / Answer

Rising over time


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