I am trying to caclulate yield, duration, and the like but I know nothing about it and the formulas make no sense to me. This is the full problem:

National Bank current balance sheet appears below. All assets and liabilities are currently priced at par and pay interest annually.

Assets

Amount ($ millions)

Annual Rate

Liabilities

Amount ($ millions)

Annual Rate

1-year bonds

$60

7%

1-year CD

$50

5%

10-year loan

$40

12%

2-year CD

$40

6%

Equity

$10

Total

$100

Total

$100

a.What is the weighted average maturity of assets?

b.What is the weighted average maturity of liabilities?

c.What is this FI's maturity gap?

d. What is market value of the one-year bond if all market interest rates increase by

2 percent?

e. What is market value of the ten-year loan if all market interest rates increase by 2

percent?

f. What is market value of the two-year CD if all market interest rates increase by 2

percent?

g.What is the impact on the FI's equity of a 2 percent overall increase in market

interest rates on all fixed-rate instruments?Briefly discuss your results.

and

The following information is about current spot rates for Mega Savings' assets (loans) and liabilities (CDs). All interest rates are fixed and paid annually.

Assets

Liabilities

1-year loan rate: 7.50 percent

1-year CD rate: 6.50 percent

2-year loan rate: 8.15 percent

2-year CD rate: 6.65 percent

a. If rates do not change, the balance sheet position that maximizes the FI's returns is?

b. What is the duration of the two-year loan (per $100 face value) if it is selling at par?

c. If the FI finances a $500,000 2-year loan with a $400,000 1-year CD and equity, what is the leveraged adjusted duration gap of this position? Use your answer to the previous question.

d.Use the duration model to approximate the change in the market value (per $100 face value) of two-year loans if interest rates increase by 100 basis points.

e. What is the duration of this Treasury note?

f. If interest rates increase by 20 basis points (i.e.,R = 20 basis points), use the duration approximation to determine the approximate price change for the Treasury note.Briefly discuss.