Use the balance sheet of a bank below to answer the following. The duration of asset is 1.5years, the duration of liabilities 2years.AssetsLiabilitiesRequired Reserves8 mMoney Market Deposits50 mExcess Reserves7 m3-year CDs60 mT-bills85 mCapital10 mMortgages15mCommercial paper5mWhat happens to the value of liability if the interest rate goes down by 1%?up by 2%down by 2%O down by 1.36%O up by 1.36%

Calculate the duration gap:Duration Gap = Duration of Assets - Duration of LiabilitiesDuration Gap =…

Answered: Use the balance sheet of a bank below…

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter7: Types And Costs Of Financial Capital

Section: Chapter Questions

Problem 2EP

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am. 118.
A loan of $10,000 is taken out on November 7, 2020 at a simple interest rate of r = 9%. The loan will be paid back on May 11, 2021. If the bank uses ordinary interest (the Banker's Rule), how much interest is charged? a $450.00 b $456.16 c $443.84 d $462.50

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