5. Let us go back to the case with $5 billion of mortgage losses, but now suppose...

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5. Let us go back to the case with $5 billion of mortgage losses, but now suppose that because there is an economy-wide recession, the bank also loses another

$10 billion on its non-mortgage assets (for example some of the companies it was lending to themselves go bankrupt). What happens in this case?

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Macroeconomics

ISBN: 125389

3rd Global Edition

Authors: Daron Acemoglu ,David Laibson ,John List

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