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4. Please use duration gap analysis to determine if there is interest rate risk in the following transaction: A bank obtains $25,000 in funds from
4. Please use duration gap analysis to determine if there is interest rate risk in the following transaction: A bank obtains $25,000 in funds from a customer who makes a deposit with a 5 year maturity that pays 5% interest compounded daily. All interest and principle are paid at the end of the 5 years maturity. As the same time the bank makes a $25,000 loan to an individual to buy a car. The loan has a fixed interest of 12% but is fully amortized over 60 months
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