The following balance sheet information is available (amounts in thousands of dollars and duration in years) for a financial institution:

Treasury bonds are five-year maturities paying 7 percent semiannually and selling at par. By applying the Macaulay duration formula, we get the duration of the T-bond portfolio equals 4.3038 years.

a. What is the average duration of all the assets (D_A)?

b. What is the average duration of all the liabilities (D_L)?

c. What is the leverage-adjusted duration gap?

d. What is the forecasted impact on the market value of equity (E) caused by a relative downward shift in the entire yield curve of 0.5 percent [i.e., y/(1+y) = -0.0050]?

\begin{tabular}{lrr} & Amount & Duration \\ \cline { 3 - 3 } Asset & & 0.50 \\ T-bills & $110 & 0.90 \\ T-notes & 45 & x \\ T-bonds & 175 & 3.00 \\ Loans & 1,170 & \\ Total & 1,500 & \\ Liabilities and Equity & & \\ Core Deposits & 1,115 & 2.50 \\ Euro CDs & 250 & \\ Equity & 135 & \\ Total & 1,500 & \end{tabular}