If the Fed increases the Fed fund rates next month, we can expect banks that finance long-term fixed-rate mortgages with short-term rate-sensitive deposits to be exposed to in net interest income and in the market value of equity.

A. decreases; increases

B. increases; increases

C. decreases; decreases

D. increases; decreases

Which of the following is the correct way of calculating the "gap" in each maturity bucket in the repricing model?

A. Substracting rate-sensitive assets from rate-sensitive liabilities

B. Substracting rate-sensitive liabilities from rate-sensitive assets

C. Substracting current assets from current liabilities

D. Substracting long-term liabilities from fixed assets