Question: 6. The Troubled Asset Relief Program (TARP) Consider a bank that has assets of 100, capital of20, and short-term credit of 80. Among the bank's

the bank's assets are securitized assets whose value depends on the price

6. The Troubled Asset Relief Program (TARP) Consider a bank that has assets of 100, capital of20, and short-term credit of 80. Among the bank's assets are securitized assets whose value depends on the price of houses. These assets have a value of 50. a. Set up the bank's balance sheet. Suppose that as a result of a housing price decline, the value of the bank's securitized assets falls by an uncertain amount, so that these assets are now worth somewhere between 25

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