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First National Bank Assets Liabilities Rate-sensitive $40 million $50 million Fixed-rate $60 million $50 million If interest rates rise by 5 percentage points, say from
- First National Bank
| Assets | Liabilities |
Rate-sensitive | $40 million | $50 million |
Fixed-rate | $60 million | $50 million |
If interest rates rise by 5 percentage points, say from 10 to 15%, what will the effect on bank profits (measured using gap analysis) be?
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