Question: 2. (6 points) Refer to the values calculated for Ist Bank of Yuma in the previous problem. a. (3 pts ) Suppose the average duration

2. (6 points) Refer to the values calculated for Ist Bank

2. (6 points) Refer to the values calculated for Ist Bank of Yuma in the previous problem. a. (3 pts ) Suppose the average duration of assets for the Ist Bank of Yuma is 5 and average duration of liabilities is 1. Suppose interest rates increase by one percentage point. What is the new value for capital? b. (3 pts ) Suppose the gap between rate sensitive assets and rate sensitive liabilities is $30 million. If interest rates increase by one percentage point, what is the change in total profits

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