The following entries (in millions of dollars) are from the balance sheet of Rivendell National Bank (RNB): U.S. Treasury bills $16 Demand deposits Mortgage-backed securities Loans from other banks C&I loans Discount loans $34 $33 $10 $54 $8 NOW accounts $35 Savings accounts $15 Reserve deposits with Federal Reserve $8 $9 $10 $3 Cash items in the process of collection Municipal bonds Bank building If RNB's assets have an average duration of five years and its liabilities have an average duration of four years, what is RNB's duration gap? Duration gap =
The following entries (in millions of dollars) are from the balance sheet of Rivendell National Bank (RNB): U.S. Treasury bills $16 Demand deposits Mortgage-backed securities Loans from other banks C&I loans Discount loans $34 $33 $10 $54 $8 NOW accounts $35 Savings accounts $15 Reserve deposits with Federal Reserve $8 $9 $10 $3 Cash items in the process of collection Municipal bonds Bank building If RNB's assets have an average duration of five years and its liabilities have an average duration of four years, what is RNB's duration gap? Duration gap =
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter27: Money And Banking
Section: Chapter Questions
Problem 25CTQ: Explain the difference between how you would characterize bank deposits and loans as assets and...
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