Bank of the Atlantic has liabilities of $4 million with an average maturity of two years paying interest rates of 4.0 percent annually. It has assets of $5 million with an average maturity of 5 years earning interest rates of 6.0 percent annually. To what risk is the bank exposed?

a). Reinvestment risk.
b). Refinancing risk.
c). Interest rate risk.
d). Reinvestment risk and interest rate risk.
e). Refinancing risk and interest rate risk.

Answer rating: 100% (QA)

Answer the correct option is 60000 Given that the company refinanced its liabilities at 60 Here ... View the full answer