Question $14(1$ point$)$

Assets Liabilities

Rate$-$sensitive $$20$ million $$50$ million

Fixed$-$rate $$80$ million $$50$ million

If interest rates rise by $5$ percentage points, say, from $10$ to $15$ percent, bank profits $($measured using basic gap analysis$)$ will $\_\_\_\_\_\_\_\_.$

Question $14$ options:

decline by $$0\mathrm{.}5$ million

decline by $$1\mathrm{.}5$ million

decline by $$2\mathrm{.}5$ million

increase by $$1\mathrm{.}5$ million