The economics class at 10 a. m. is the same as the supply of seats for the same class at but while every student who wants to attend this class at 12 noon can, not every student who wants that the demand for the 10 a. m. class supply of seats for an 2 noon, to attend the 10 a. m. class can. Tuition does not vary by time. It follows that the demand for the 10 a. m. class is the demand for the noon class. a. lower than b. the same as c. greater than d. either a or b e. none of the above

Variable rate cd’s = $90 treasury bills = $150 discount loans = $20 treasury notes = $100 fixed rate cds = $160 money market deposit accts. = $140 savings deposits = $90 fed funds borrowing = $40 variable rate mortgage loans $140 demand deposits = $40 primary reserves = $50 fixed rate loans = $210 fed funds lending = $50 equity capital = $120 a. develop a balance sheet from the above data. be sure to divide your balance sheet into rate-sensitive assets and liabilities as we did in class and in the examples. b. perform a standard gap analysis and a duration analysis using the above data if you have a 1.15% decrease in interest rates and an average duration of assets of 5.4 years and an average duration of liabilities of 3.8 years. c. indicate if this bank will remain solvent after the valuation changes. if so, indicate the new level of equity capital after the valuation changes. if not, indicate the amount of the shortage in equity capital.