The Harris State Bank has $2,000 in total assets (all of which are earning assets), $500...

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The Harris State Bank has $2,000 in total assets (all of whichare earning assets), $500 of which will be repriced in the next 90days. This bank also has $1,600 in total liabilities, $1,000 ofwhich will be repriced in 90 days. The bank currently earns 9percent on its assets and pays 4 percent on its liabilities.

If interest rates on both assets and liabilities rise by 2 percentin the next 90 days, what would be this bank's net interestmargin?
4.2 percent
5.3 percent
5.8 percent
6.2 percent
7.8 percent

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The Harris State Bank has $2,000 in total assets (all of whichare earning assets), $500 of which will be repriced in the next 90days. This bank also has $1,600 in total liabilities, $1,000 ofwhich will be repriced in 90 days. The bank currently earns 9percent on its assets and pays 4 percent on its liabilities. If interest rates on both assets and liabilities rise by 2 percentin the next 90 days, what would be this bank's net interestmargin?4.2 percent5.3 percent5.8 percent6.2 percent7.8 percent