You are given the following information about FelixBank Assets duration (average) = 2.695 years Liabilities duration (average) = 1.03 years Assets = $100 million Bank capital = $5 million Interest rates are 10% Question 1 What will happen to FelixBank's net worth ( amount) if interest rates rise by 10 percentage points? Will FelixBank stay in business? Why or why not? Question 2 How should FelixBank alter the duration of its assets to immunize its net worth from interest-rate risk? You are given the following information about FelixBank Assets duration (average) = 2.695 years Liabilities duration (average) = 1.03 years Assets = $100 million Bank capital = $5 million Interest rates are 10% Question 1 What will happen to FelixBank's net worth ( amount) if interest rates rise by 10 percentage points? Will FelixBank stay in business? Why or why not? Question 2 How should FelixBank alter the duration of its assets to immunize its net worth from interest-rate risk