Part 2: Blue Sunday Bank has a portfolio of loans and securities as well as deposits and money market borrowings that are expected to produce the following cash inflows and outflows for the bank in the coming five years. Cash inflows are denoted with a + and cash outflows are denoted with a -. Expected cash flow (in %bodyamp;rsquo;s) Timing of cash flow + 1.9 million 1 year from today - 1.4 million 1 year from today + 750,000 2 years from today - 830,000 2 years from today + 350,000 3 years from today - 400,000 3 years from today + 65,000 4 years from today - 45,000 4 years from today + 10,000 5 years from today - 40,000 5 years from today

Now assume that the bank has total assets of $30 billion and total liabilities of $25 billion and all asset and liability cash flows are proportional to the cash flows given in this problem. How much would the value of the bank change if interest rates rise from 4.5% to 5.0%? What about if interest rates changed from 4.5% to 4.2%? Assume that total assets and total liabilities have the same duration profile as the cash flows given in this problem. Show your calculations on the spreadsheet.