Assume a bank has the following balance sheet (in millions).

Loan A (8%, 3 year) = $100

Deposit A (5%, 2 years) = $250

Loan B (11%, 4 years) = $200 Equity = $10

Deposit B (7%, 3 year) = $40 Total Assets = $300

Total Liabilities = $300

Estimate the impact on the economic value of equity (EVE).

a. If all interest rates decrease by 3%

b. If interest rates of assets increase by 1% and deposit rates decrease by 2%.