Problem
Nearby Bank has the following balance sheet (in millions):
|
Assets
|
Liabilities and Equity
|
|
Cash
|
$60
|
Demand deposits
|
$140
|
|
5-year Treasury notes
|
60
|
1-year certificates of deposit
|
160
|
|
30-year mortgages
|
200
|
Equity
|
20
|
|
Total assets
|
$320
|
Total liabilities and equity
|
$320
|
What is the maturity gap for Nearby Bank? Is Nearby Bank more exposed to an increase or a decrease in interest rates? Explain why
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.