Equitable Finance Company has a following financial statement for the current year.

Question: What will happen to the company's net income if the interest rates fall from 5% to 4%?

Net income will increase by $100,000

Net income will decrease by $100,000

Net income will increase by $150,000

Net income will increase by $10,000

Net income will increase by $110,000

Net income will decrease by $10,000

Net income will decrease by $110,000

Net income will decrease by $150,000

Assets Liabilities Amount Duration Amount Duration Cash and deposits $4,000,000.00 0 Commercial paper $45,000,000.00 0.3 Securities Bank loans Less than Less than $6,000,000.00 0.5 $5,000,000.00 0.6 1 year 1 year Greater than 1 year $2,000,000.00 5 Greater than 1 year $30,000,000.00 3 Consumer loans Long-term bonds and other $10,000,000.00 long-term debt 8 Less than 1 year $55,000,000.00 0.2 Greater than 1 year $30,000,000.00 4 Capital $10,000,000.00 Physical capital $3,000,000.00 0 Total $100,000,000.00 Total $100,000,000.00