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Question
What is the impact on economic capital of a 25 basis point decrease in interest rates if the FI is holding a 20-year, fixed-rate, 11 percent annual coupon bond selling at a par value of $100,000?
A. A decrease of $250.
B. An increase of $250.
C. An increase of $2,024.
D. A decrease of $1,959.
E. No impact on capital since the book value is unchanged.
Answer
This answer is hidden. It contains 53 characters.
Related questions
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