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Suppose a bank has assets of $100 billion and liabilities of $90 billion. The banks assets have a duration of 5 years and the banks

Suppose a bank has assets of $100 billion and liabilities of $90 billion. The banks assets have a duration of 5 years and the banks liabilities have a duration of 1 year. Suppose in a given period interest rates rise from 2% to 4%. How much will the banks shareholders equity change over that period? (Choose the closest answer)

A) It will increase by about $4 billion

B) It will decrease by about $4 billion

C) It will increase by about $8 billion

D) It will decrease by about $8 billion

E) It will not change

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