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Alex17521 [72]
3 years ago
12

First National Bank of America has more than 75% of its assets in first residential fixed-rate mortgages that mature in more tha

n 5 years. Suppose that a 12-month Gap Analysis predicts a decrease in 2021 interest income of $3 million if there is a sudden 1% drop in market interest rates. From your knowledge of the practical flaws in gap analysis, a realistic simulation analysis would predict that:_______.
1. Interest income will drop by more than $3 million for a sudden 1% drop in market interest rates
2. Interest income will drop by less than $3 million for a sudden 1% drop in market interest rates
Business
1 answer:
iris [78.8K]3 years ago
7 0

Answer:

2. Interest income will drop by less than $3 million for a sudden 1% drop in market interest rates

Explanation:

Since in the question it is mentioned that there is decrease in 2021 interest income of $3 million in the case when there is a sudden decline of 1% in the rate of interest of the market this is due to the convexity of the curve as the GAP analysis and assume straight line

So the option 2 is correct

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Which of the following is true?
Mandarinka [93]

Answer:

The answer is "Choice C".

Explanation:

The federal securities legislation governs its sales or offering of stock, investment management, the companies of some industry professional persons, investment companies like mutual funds, tender documents, proxy statements, and, more particularly, publicly-traded company control.  It's not just the external directors, but also the managers of the organization apply to these rules mostly on the release of erroneous financial reports.

3 0
3 years ago
Beth's business purchased only one asset during the current year (a full 12-month tax year). Beth placed in service machinery (7
nalin [4]

Answer:

the depreciation expense on the equipment will be 1,785 for tax purpose.

Explanation:

We will look into the MACRS (Modified Accelerated Cost Recovery System)

table for a property of seven years placen into service in the 4th quarter:

Which give us 3.57%

now we multiply the basis by the coefficient and get the value for depreciation

50,000 x 3.57% = 1,785 depreciation expense under MACRS

4 0
3 years ago
Chloe takes $100 of currency from her wallet and deposits it into her checking account. If the bank adds the entire $100 to rese
melomori [17]

Answer:

Chloe takes $100 of currency from her wallet and deposits it into her checking account. If the bank adds the entire $100 to reserves, the money supply <em>remains at the same level</em>, but if the bank lends out some of the $100, the money supply <em>increases</em>.

Explanation:

The money supply is the money offered by bank if all the 100 dollars goes into reserve then, the money supply is not using those 100 therefore, it is not increasing.

keeping those dollars in reverse do not change the current supply as the money offered by the bank is the same.

While using a portion of the 100 dolalrs to give a loan increase the available money.

5 0
3 years ago
braden and sons, inc. borrowed $700,000 cash from trenton savings and loan last year. in addition, the company repaid a $450,000
mafiozo [28]

Transactions must be recorded separately inside this debt or equity portion as both a drop to income of $450,000 as well as a rise of $700,000.

The accounting equation for a business must show steady income through operational operations.

These variations on obligations, investors' capital, other tangible resources may be used to reflect about the difference on income.

A firm's first stage of development is prone to experience operational and investment income stream. retained earnings through funding that is profitable.

1)The quantity of money that exists for usage in free liquidity 

2)pay off existing debt

3)By engaging in further investment activities, grow the company.

4)increase the company's cash position

To know more about  operational operations click here

brainly.com/question/18301011

#SPJ4

6 0
1 year ago
When flying a GPS approach procedure, what effect will overriding an automatically selected sensitivity have?
ss7ja [257]

Answer: It will cancel the approach mode annunciation

Explanation: GPS(Global positioning system) is a United States of America owned navigation system which makes use of radio waves it was developed and managed by the United States Department of defense. When flying a GPS approach procedure,it is recommended not to override an automatically selected sensitivity,the approach mode annunciator or receiver should be verified before making any changes.

7 0
3 years ago
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