The Tidewater State Bank has $1,000 in total assets (all of which are earning assets),$700 of which will be repriced within the next 90 days. This bank also has $800 in totalliabilities, $400 of which will be repriced within the next 90 days. Currently, the bank isearning 8 percent on its assets and is paying 5 percent on its liabilities.If interest rates on both assets and liabilities decrease by 2 percent in the next 90 days,what would be this bank's net interest margin?3.4 percent4 percent0.4 percent5.6 percent2 percent

Total assets= $1,000Repriced assets = $700Total liabilities = $800Repriced liabilities =…

Answered: The Tidewater State Bank has $1,000 in…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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