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Financial Institutions Such as Commercial Banks, Bond Mutual Funds, Insurance

Question 15

Multiple Choice

Financial institutions such as commercial banks, bond mutual funds, insurance companies, and pension funds maintain large portfolios of bonds, so their portfolios are ____ affected when the Fed____ interest rates.


A) unfavorably; decreases
B) unfavorably; increases
C) favorably; increases
D) A and C are correct.

Correct Answer:

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