An embedded option associated with each of the following instruments potentially alters the rate sensitivity of the underlying instrument. Indicate: 1. the options embedded; 2. will the option be exercised if the current prime rate is 3.25%; 3. when the option is typically exercised and 4. how it affects rate sensitivity. a. Fixed-rate mortgage loan with a yield of 2.5% and 30- year final maturity. b. Time deposit with five years remaining to maturity; carries a fixed rate of 4%. c. Commercial loan with a 2-year maturity and a floating rate set at prime plus 2.5%. There is a cap of 6% representing the maximum rate that the bank can charge on the loan. (Kind reminder: be concise and directly to the point. Listing of key words could also earn partial credits.) An embedded option associated with each of the following instruments potentially alters the rate sensitivity of the underlying instrument. Indicate: 1. the options embedded; 2. will the option be exercised if the current prime rate is 3.25%; 3. when the option is typically exercised and 4. how it affects rate sensitivity. a. Fixed-rate mortgage loan with a yield of 2.5% and 30- year final maturity. b. Time deposit with five years remaining to maturity; carries a fixed rate of 4%. c. Commercial loan with a 2-year maturity and a floating rate set at prime plus 2.5%. There is a cap of 6% representing the maximum rate that the bank can charge on the loan. (Kind reminder: be concise and directly to the point. Listing of key words could also earn partial credits.)