The market value of Big Sky Banks earning assets is $600 million and the assets have an average duration of two years. The market value of the banks funding liabilities is $550 million and the liabilities have an average duration of two years.

1. What is the duration gap of the bank as it stands now?
2. A T-Bond futures contract with a notional value of $100,000 and a duration of ten years is available. How many contracts should comprise the banks position if the bank wants to have a duration gap of zero? Should the bank take a long or short position in the futures contracts?