Problem 2 The balance sheet of Capital Bank appears as follows: Assets Llabilities and Maturities Short Term Securities and adjustable Rate Loans 5220 Short Term and Floating Rate Funds $560 Duration: 6 months Duration 6 months Pared-Rate Loans Duration: 3 years. 700 Foced-Rate Funds Duration: 30 months. 270 Nonearning Assets 30 Equity 170 Total Assets $1000 Total Labrities and Net Worth $1000 Required: Calculate the duration gap of this bank Assuming that the required rate of return is percent what would be the effect on the bank's net worth if interest rates Increased by 1 percent Suppose that the expected change in net worth is unacceptable to management. What outcome could management take to reduce this change