Question: How much would each variable need to change to get GDAP equal to 0? Book Value Market Value Assets Amount Amount Duration T-bills $ 360

How much would each variable need to change to get GDAP

How much would each variable need to change to get GDAP equal to 0?

equal to 0? Book Value Market Value Assets Amount Amount Duration T-bills

Book Value Market Value Assets Amount Amount Duration T-bills $ 360 $ 360 0.50 Loans* 10,000 $9.470 11.50 Total Assets 10,360 9830 Liabilities Deposits 8.368 8,368 0.50 Total Liabilities 8,368 8,368 Equity 1,992 1,462 Total Lia and NW 10,360 9,830 (10,000*6.5%) *(1-(1+7%) ^-20)/7%+10,000/ (1+7%) ^20=9,470.30=9,470 360+9,470=9,830 9,830-8,368= 1,462 *Since this is a simple bank, it has only one type of loan. The loan has a $10,000 book value (current outstanding principal), "amortized" loan with annual payments, an interest rate of 6.5 percent, and 20-years to maturity. Similar amortized loans today (market interest rate for similar loans) have an interest rate of 7 percent which, is the market yield

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