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Question
Which of the following completes the statement: All else equal, the higher the duration of a loan,
A. the lower the current level of interest rates, the higher the RAROC.
B. the lower the expected change in risk premium, the lower the RAROC.
C. the higher the expected change in risk premium, the higher the RAROC.
D. the higher the loan amount, the lower the RAROC.
E. the lower the loan amount, the lower the RAROC.
Answer
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