please explain

Dollur hpert in thousuads Merchants naak Wisose Total engloyses that ene eyivales Total assets Cous ant hur fron depoutur? indieviont Colketioe in domenes effices Carmacy and coen in daniribe oflices intheree in 0 e US Mokso be fion ran Secuesen mocuritice meryen: Over tioce yeas thesed five yean Oren ilve years though then years One kifees year CMOs, WuMci and wives Mhs Nore jears or lest Oner iner jrar Other Lets seconiles Nure mantha in iase 2576574 085427,5910,7600.00.00000 Duration Grare) Sol Treal Ausets Traniacion kgoosts Inividuale, fansentige and corperationes Us Coenticteial basks wa efor depewasen ieurhotion is the DS. Noncrahtanties kcouks Money nanet depoir accowats (Moriva) Oher avingr de ponia (escladirs MMDAs? Tocal time deponia. Aptontariti All neer labilition Tital equary capiea Hakaties Aewrats Deartise (Assets Average Duration - (( Total Liabilities / Total Assets) X Duration Gap =Liabilities Average Duration) Assets Liabilities Net Worth \% Change in Net - Duration Gap X (Change in interest Worth = rate /(1+ interest rate (old )) as a % age of Assets In Week Seven we learn more about how to manage Interest rate Risk. In this assignment you will use Duration in the bank's gap analysis. Using the Merchants Duration Example as a guide (a copy of the Excel file is in the Content for Week Seven) please find the Weighted Average Duration of assets and the liabilities for the Merchants National Bank. Using the Merchants Duration Example Excel file, you will need to first find the Percentage each Asset and Liability account is of Total Assets. Then you need to multiply that Percentage and the Duration is for that account. By totally Weighted Average Duration for each account for Assets and then Liabilities you should find the Assets Average Duration and then the Liabilities Average Duration. I would like you to find the Duration Gap, Assets Percentage (\%) Change in Price, Liabilities Percentage (%) Change in Price, and the Percentage (\%) Change in Net Worth as a Percentage (\%) of Total Assets. In calculating the "percentage change in price," you are to expect interest rates to rise from 5.5% to 6.5% given the actions of the Federal Reserve. Once done with your calculations in the excel file, please answer the following questions in a separate Word file. 1. Discuss what you have found for Merchants National Bank in your duration gap analysis and what means for the interest rate risk being taken on by Merchant National Bank. 2. Discuss why a bank may have to sacrifice yield to vary its duration gap. 3. What are the strengths and weaknesses of duration gap analysis? 4. Given today's interest rate environment what does Merchants' Duration Gap mean to their future? Ovee five years thosect fifieen yein Ovar thees yean Federal funbry nold and revene mpuctare aperonents Net hana nad leaset Allowance for loun ahd Inave louri at ox, 110% 1854204 Trating acroun wivels Lanas and bases, erens oe 14 eridestial hana: Three moethi or less "Over 3 manchi troept 12 enonats. Over 1 ytai tonsth 3 yries Oret 3 yean group 3 yean Oitr 5 yein thortis yean Over 15 yrars All eater lowas. Thes mand a of les Over 3 movin broph 12 reoedn Over 1 yeder thrugh 3 yean Over 3 ytan svagh 5 ytan Oeet is years Biax frrmises atd fised abeta As tether went \begin{tabular}{|c|c|} \hline 816 & 0.1 \\ \hline 14,125 & 0.7 \\ \hline 4,79 & 2.2 \\ \hline & 15 \\ \hline 59,104 & 89 \\ \hline 3453 & 196 \\ \hline 606309 & 0.1 \\ \hline 125815 & 03 \\ \hline 135,44 & 22 \\ \hline 26.373 & is \\ \hline & is \\ \hline (4) 581 & the \\ \hline 47344 & OD \\ \hline (10) & 00 \\ \hline 33,363 & 00 \\ \hline noat & 00 \\ \hline \end{tabular} Total liabilities and capital Aenis Nerag theralies The depeser Trane ties arown