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Liberty Bank has just made a large infrastructure loan of $300mn. Its balance sheet prior to making the loan is as follows: Assets $ millions

Liberty Bank has just made a large infrastructure loan of $300mn. Its balance sheet prior to making the loan is as follows:

Assets $ millions Liabilities $ millions
Cash 100 Deposits 610
Loan portfolio 600 Equity 90
Total assets 700 Total liabilities and equity 700

Duration of assets in the table above = 6 years

Duration of liabilities in the table above = 3 years

Assuming the new infrastructure loan has a duration of 7.5years, calculate the new duration of the banks assets after giving out this loan. Give your answer to 1 decimal place. Do not include any units.

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