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Question
First National Bank
Table 24.1
Refer to Table 24.1. Assuming that the average duration of its assets is five years, while the average duration of its liabilities is three years, a rise in interest rates from 5% to 10% will cause the net worth of First National to _________ by _________ of the total original asset value.
A)increase; 11%
B)decline; 11%
C)increase; 10%
D)decline; 5%
Answer
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