8. A bank has the following balance sheet: Assets Avg. Rate Liabilities/Equity Avg. Rate Rate sensitive $550,000 7.75% Rate sensitive $375,000 6.25% Fixed-rate 755,000 8.75 Fixed rate 805,000 7.50 Nonearning 265,000 Nonpaying 390,000 Total $1,570,000 Total $1,570,000 Suppose interest rates rise such that the average yield on rate-sensitive assets increases by 45 basis points and the average yield on rate-sensitive liabilities increases by 35 basis points. a. Calculate the banks CGAP and gap ratio. b. Assuming the bank does not change the composition of its balance sheet, calculate the resulting change in the banks interest income, interest expense, and net interest income. c. Explain how the CGAP and spread effects influence the change in net interest income.