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4 of 18 of 18 It is given Bank XYZ having the following balance sheet: Assets (5 billion) Liab & Equity ($ billion) Cash 20

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4 of 18 of 18 It is given Bank XYZ having the following balance sheet: Assets (5 billion) Liab & Equity ($ billion) Cash 20 200 Deposits Long-term-debt M/S 40 10 Loans 160 Fixed assets 10 Equity capital 20 Total assets 230 Total L&E 230 The bank manager estimates that the bank's Mac Da = 45 years and Mac DL= 3.5 years. The bank would like to restrict its maximum equity exposure to $ 3.5 B and the current interest rate is 9% Based on all the above given information, the maximum increase in interest rate without going over the set equity exposure is: O 1.17% O 1.27% O 1.47 % O 1.67% O 184% If the market interest rate goes up only by 50% of your calculated value above, the market value of the bank's total assets and total liabilities will OS 202 B and 185 B O $ 204 B and 206 B O $ 214 B and 206 B O S 224 B and 206 B ch O BI 11

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