A bank today makes $100 in 3-year loans with a 16% fixed annual interest rate....
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Finance
A bank today makes $100 in 3-year loans with a 16% fixed annual interest rate. It funds the loans today with $100 in 1-year CDs that currently have a 7% annual interest rate. What is the banks expected net interest income in the second year if interest rates rise by 1% tomorrow and remain at that level for the next two years
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