Below are the assets and liabilities of a bank Liabilities (with current interest rate) Checking Assets (with current interest rate) Fixed: 0% | Variable: 290 | Fixed: 400 | Variable: 690 | Cash $10 billion Variable: 1% | $50 billion Government Securities Mortgage Loans Business Savings Deposits Short-term $20 billion Fixed: 290 | $20 billion $50 billion Borrowings I Variable 390 | $20 billion To be determined $20 billion | Bank Capital S10 billiorn oans A. What is the bank's annual net interest income (interest income minus interest expense) assuming no loan defaults? B.Ifthe bank has $1 billion in other operating costs, what will be the bank's return on capital? C. Ifinterest rates increase two percent, what will be the change in the bank's net interest income? [Variable rates change but fixed rates do not change.] D.If customers wanted to immediately withdraw $20 billion of checking deposits, what could the bank do to provide these customers their funds? E.IfS5 billion of the bank's business loans default, what will happen to the value of the bank capital? Why? (2 points)