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Please show on excel using formulas Consider the balance sheet of a Financial Institution that recently issued CDs in the US to offer loans in

image text in transcribedPlease show on excel using formulas

Consider the balance sheet of a Financial Institution that recently issued CDs in the US to offer loans in the US and the UK. The 1-year US CD rate is 7%, the UK CD rate is 10\%, the 1- year US nominal risk free loan rate is 8% and the UK nominal risk free loan rate is 13%. Show all the calculations to answer the following questions. a. If the spot year 1 year from now for USD/GBP remains the same as the current spot rate of 0.74 , what is the net % return? b. If the spot year 1 year from now for USD/GBP increases to 0.79 , what is the net \% return? c. Given the above 1-year nominal risk free rates in the US and in the UK, the bank enters into a derivative contract to employ "off the balance sheet hedge", what is the net % return

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