Question

The following are the assets and liabilities of a government security dealer.

What is the impact over the next 30 days on the dealer's net interest income if all interest rates increase by 50 basis points?

A. Net interest income will decrease by $50,000.

B. Net interest income will decrease by $2.125 million.

C. Net interest income will decrease by $475,000.

D. Net interest income will decrease by $2.375 million.

E. Net interest income will increase by $750,000.

Answer

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