For a Bank That Has a Negative Duration Gap, a Decrease

Multiple Choice

For a bank that has a negative duration gap, a decrease in interest rates will cause a(n) _______ in the economic value of assets that is _______ than the _______ in the economic value of liabilities, and a(n) _______ in the economic value of equity.

A) increase, less, increase, decrease
B) increase, greater, increase, decrease
C) increase, less, decrease, increase
D) decrease, less, decrease, increase
E) decrease, greater, decrease, decrease