Bank Duration GAP: State Bank's balance sheet is listed below. Market yields and durations (in years) are in parenthesis, and amounts are in millions. Calculate Liabilities and Equity Assets Demand Deposits $250 Cash $20 Fed Funds (5.05% , 0.02) MMDAS (4.5%, 0.50) 150 (no minimum balance requirement) T-bills (5.25%, 0.22) 300 360 T-bonds (7.50%, 4.55) CDs (4.3%, 1.48) 200 715 Consumer loans (6%, 2.50) CDs(6%, 4.45) 900 1,105 C&l loans (5.8% , 5.58) Fed Fund (5%, 0.02) 475 515 Fixed-rate mortgages (7.85, Commercial paper (5.05%, 0.45) 1200 400 8.50) Variable-rate mortgages, Subordinated debt: repriced @ quarter (6.3%, 0.25) Fixed-rate (7.25%, 6.65) 580 200 Premises and equipment Total Liabilities 120 $3,545 Equity 400 Total Liabilities and equity Total assets $3,945 $3,945 a. What is State Bank's Duration Gap? b. What does this Duration Gap mean? Discuss what is the effect of an interest rate change on Bank Equity value