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Cash 5.000 ( CD 20,000 Bond 25.000 Equity 10.000 Total Assets 30,000 Total Liabilities and 30.000 Equity The bond has 20 years to maturity, a

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Cash 5.000 ( CD 20,000 Bond 25.000 Equity 10.000 Total Assets 30,000 Total Liabilities and 30.000 Equity The bond has 20 years to maturity, a fixed coupon rate of 6%, and face value of 25,000. The CD has a fixed rate of 3% and 1 year to maturity. Calculate all answers to the nearest dollar (no decimals) a) calculate net interest income at the end of the first year: b) If market interst rates have decreased by 70 basis points at the end of year 1, calculate the bond price at the end of year 1

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