Consider the following balance sheet for Watchover Savings Inc. (in millions):

Assets:

Floating-rate mortgages (currently 11% p.a.) $98

30-year fixed-rate loans (currently 8% p.a.) $109

Total: $207

Liabilities and Equity:

Now deposits (currently 7% p.a.) $124

5-year time deposits (currently 7% p.a.) $36

Equity $47

Total: $207

a.What is Watchover's expected net interest income at year-end?(Enter your answer in millions rounded to 2 decimal places. (e.g., 32.16))

Ans: _________ million

b.What will be the net interest income at year-end if interest rates rise by 2 percent?(Enter your answer in millions rounded to 2 decimal places. (e.g., 32.16))

Ans: _________ million

c.Using the one-year cumulative repricing gap model, what is the change in theexpected net interest income for a 2 percent increase in interest rates?(Negative amount should be indicated by a minus sign. Enter your answer in millions rounded to 2 decimal places. (e.g., 32.16))

Ans: _________ million