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QUESTION 6 You are assessing the interest rate risk of following balance sheet. Assets Liabilities A- $100 m L- $90 m E $10 m Assume that the average duration of assets is 5 years, while the average duration of liabilities is 3 years. What would happen to the banks equity if, interest rates were decreasing from 10% to 9%? Calculate the change in millions of dollars, e.g. 1 for $1 mlion. For increases just write the number, for decreases addQUESTION 7 Liabilities L- $90 m E- $10 m Assets A $100 m Assume that the average duration of assets is 5 while the average duration of liabilities is 3 years. You are the liability manager of the bank and your boss is unhappy about the interest rate risk. How should you change the duration of the liability side to eliminate all interest rate risk? Provide your answer by calculating the new liability duration with two decimals.QUESTION 8 Assets Liabilitiess L $90 m E $10 m A- $100 m Assume that the average duration of assets is 9 while the average duration of liabilities is 3 years. You are the liability manager of the bank and your boss is unhappy about the interest rate risk. How should you change the duration of the liability side to eliminate all interest rate risk? Provide your answer by calculating the new liability duration with two decimals

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Answer ® Cifren data from the problem Assests = $100m , Duration = 5 years habilites I= $ 90m - 0.0 mm f = $100 = 0.01 mm Dur

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