FINA4600 GAP management homework 1. DDR National Bank uses dollar GAP management. The following is the bank's balance sheet: Rate Sensitive Assets (7.5%) Fixed Rate Assets (90%) 30.000 30.000 Rate Sensitive Liabites (60%) Fixed Rate Liabilies (70%) 29,000 31.000 60,000 a. What is the bank's dollar GAP and its GAP Ratio? b. Calculate the bank's pretax profits. c. Recalculate pretax profits assuming a drop in interest rates of 0.5% (50 basis points) tiona te RSA with an equal amount of FRA. (Use the yields as determined in part c.) Recalculate the dollar GAP and the pretax profits d. Now assume DDR anticipates the fall in interest rates and replaces $400 of