Question: 2. If the problem is a temporary one, then an agreement with creditors that gives the firm time to recover and to satisfy everyone may

2. If the problem is a temporary one, then an agreement with creditors that gives the firm time to recover and to satisfy everyone may be worked out. However, if basic long-run asset values have truly declined, then economic losses have occurred. In this event, who should bear the losses, and who should get whatever value remains?

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