3a. (10 Points Total: 5 each). Use the following simplified balance sheet for problem #3: Rate-sensitive Fixed-rate Assets $20 million S80 million Liabilities $50 million S40 million If interest rates drop by 1 percentage points, from 3% to 2%, by how much (and in which direction) will bank profits change according to the basic gap of this bank? Change in Bank Profits = 36. Continuing with the balance sheet above, assume that the bank has $10 million in equity. How much in dollar terms will this bank's net worth change (and in which direction) due to the 5% increase in interest rates? Change in Net Worth (in $ terms) = 3a. (10 Points Total: 5 each). Use the following simplified balance sheet for problem #3: Rate-sensitive Fixed-rate Assets $20 million S80 million Liabilities $50 million S40 million If interest rates drop by 1 percentage points, from 3% to 2%, by how much (and in which direction) will bank profits change according to the basic gap of this bank? Change in Bank Profits = 36. Continuing with the balance sheet above, assume that the bank has $10 million in equity. How much in dollar terms will this bank's net worth change (and in which direction) due to the 5% increase in interest rates? Change in Net Worth (in $ terms) =