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Duration Bank Has the Following Assets and Liabilities as of Year-End

Question 54

Multiple Choice

Duration Bank has the following assets and liabilities as of year-end. All assets and liabilities are currently priced at par and pay interest annually. Duration Bank has the following assets and liabilities as of year-end. All assets and liabilities are currently priced at par and pay interest annually. What is the change in the value of its liabilities if all interest rates decrease by 1 percent? A) Approximately $2.003 million. B) Approximately -$2.355 million. C) Approximately $2.697 million. D) Approximately $2.906 million. E) Approximately $3.211 million. What is the change in the value of its liabilities if all interest rates decrease by 1 percent?


A) Approximately $2.003 million.
B) Approximately -$2.355 million.
C) Approximately $2.697 million.
D) Approximately $2.906 million.
E) Approximately $3.211 million.

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