Briefly explain whether you agree with each of  the following statements:

a. “A bank that expects interest rates to increase  in the future will want to hold more ratesensitive  assets and fewer rate-sensitive  liabilities.”

b. “A bank that expects interest rates to decrease  in the future will want the duration of its  assets to be greater than the duration of its  liabilities—a positive duration gap.”

c. “If a bank manager expects interest rates to  fall in the future, the manager should increase  the duration of the bank’s liabilities.”