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I need Answer Extra Homework on Chapter 8_Maturity Model: Answer the Following question: A FI has issued a one-year $1 million CD paying 5.75% to
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Extra Homework on Chapter 8_Maturity Model: Answer the Following question: A FI has issued a one-year $1 million CD paying 5.75% to fund a one-year $1 million CD paying an interest rate of 6%, the principle of the loan will be paid in two installments: $500,000 in six months and the balance at the end of the year. According to this situation and from the Maturity Model point of view, if interest rate falls to 4%. Answer the following questions: 1. Will the FI face the interest rate risk exposure? 2. Why? 3- Justify your argument in 2 by showing the required calculationsStep by Step Solution
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