Following is a portion of the investments footnote 8 from MetLife lnc.'s 2017 10-K report. Investment earnings are a crucial component of the financial performance of insurance companies such as MetLife, and investments comprise a large part of its assets. MetLife accounts for its bond investments as available-for-sale securities. Fixed Maturity Securities Available-for-Sale The following tables present the fixed maturity securities AFS by sector.

REQUIRED:

a. At what amount does MetLife report its bond investments on its balance sheets for 2017 and 2016?

b. What are its net unrealized gains (losses) for 2017 and 2016? By what amount did these unrealized gains (losses) affect its reported income?

c. What is the difference between realized and unrealized gains and losses? Are realized gains and losses treated differently in the income statement than unrealized gains and losses? MetLife's 2017 pre-tax income was $3,536 million. What is the maximum amount MetLife could have increased pre-tax income by selling available-for-sale securities on the last day of 2017?

d. Many analysts compute a mark-to-market investment return as follows: Net investment income + Realized gains and losses + Change in unrealized gains and losses. Do you think that this metric provides insights into the performance of MetLife's investment portfolio beyond that which is included in GAAP income statements? Explain.

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December 31, 2017 Cost or Gross Unrealized Temporary Losses Amortized OTTI Estimated (in millions) Cost Gains Losses Fair Value Fixed Maturity Securities: US. coiporate Foreign government. Foreign corporate... U.S. government and agency. RMBS...... $ 76,005 $ 7,007 $ 351 $ 82,661 55,351 6,495 312 61,534 55.569 47,394 52,409 43,446 27,846 10,752 3.836 676 4,227 279 1,145 233 (42) 28,800 State and political subdivision 1,717 13 12,455 ABS 12,213 116 39 (1) 12,291 CMBS. 8,047 222 42 8,227 Total fixed maturity securities S286,069 $24,765 $1,945 S(42) $308,931 December 31, 2016 Gross Unrealized Cost or Amortized Temporary Losses OTTI Estimated (in milons) Cost Gains Losses Fair Value Fixed Maturity Securities: U.S. corporate Foreign government. Foreign corporate.. U.S. government and agency. RMBS.. $ 73,280 49,864 49,308 41,294 28,393 $ 764 $ 78,543 $ 6,027 6,485 373 55,976 2,926 1,572 (1) 50,663 3,682 1,039 1,340 44,433 29,032 543 - 410 (10) State and political subdivision ABS CMBS 10,977 85 1 12,231 11,266 90 128 3 11,225 7.460 7,294 237 71 Total fixed maturity securities. $271,676 $21,826 $3,946 $(7) $289,563