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Use information from above tables to solve for question 5 Thank you Assets: 3 year Consumer Loans with an average interest rate of 7% Cash
Use information from above tables to solve for question 5
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Assets: 3 year Consumer Loans with an average interest rate of 7% Cash Flow (CF) Present Value Factor (PVF) $561,300 .935 $766,010 .873 $2,702,883 .816 $0 N/A $0 N/A 5 Year Commercial Loans with an average interest rate of 10% Cash Flow (CF) Present Value Factor (PVF) $755,299 .909 $1,254,503 .826 $1,855,631 .751 $3,214,131 .683 $4,005,543 .621 Liabilities: 2 year CD deposit with an average interest rate of 3% Cash Flow (CF) Present Value Factor (PVF) $5,822,155 .971 $4,400,000 .943 $0 $0 $0 3 Year Bonds with an average interest rate of 5% Cash Flow (CF) Present Value Factor (PVF) $150,00 1952 $150,00 .907 $3,150,000 .864) $0 N/A $0 N/A Question 5: Based on your calculations from questions 3 and 4, calculate the total change in value of the bank's 3 year loans (Asset) and the change in total value of the bank's 2 year CD (Liability) if yields to maturity (interest rates) increase by 2.5% for both these two accounts. When calculating the modified duration assume all payments are made yearly for both the 3 year loans and the 2 year CD. ***Input your answer in the $XXX,XXX format and round to the nearest whole dollar. If the number is negative input in the - $XXX,XXX format. The change in value for the 3 year loan is The change in value for the 2 year CD is Assets: 3 year Consumer Loans with an average interest rate of 7% Cash Flow (CF) Present Value Factor (PVF) $561,300 .935 $766,010 .873 $2,702,883 .816 $0 N/A $0 N/A 5 Year Commercial Loans with an average interest rate of 10% Cash Flow (CF) Present Value Factor (PVF) $755,299 .909 $1,254,503 .826 $1,855,631 .751 $3,214,131 .683 $4,005,543 .621 Liabilities: 2 year CD deposit with an average interest rate of 3% Cash Flow (CF) Present Value Factor (PVF) $5,822,155 .971 $4,400,000 .943 $0 $0 $0 3 Year Bonds with an average interest rate of 5% Cash Flow (CF) Present Value Factor (PVF) $150,00 1952 $150,00 .907 $3,150,000 .864) $0 N/A $0 N/A Question 5: Based on your calculations from questions 3 and 4, calculate the total change in value of the bank's 3 year loans (Asset) and the change in total value of the bank's 2 year CD (Liability) if yields to maturity (interest rates) increase by 2.5% for both these two accounts. When calculating the modified duration assume all payments are made yearly for both the 3 year loans and the 2 year CD. ***Input your answer in the $XXX,XXX format and round to the nearest whole dollar. If the number is negative input in the - $XXX,XXX format. The change in value for the 3 year loan is The change in value for the 2 year CD isStep by Step Solution
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