10) Why are regulators concemed with the levels of catal n Financial Instiution (F) oompared with thoe hedby institution A. Because they should not write down the value of heir etsflly efect market values B. Because they must conform te regulatory write-dewn schedles C. Because the failure of one FI imposes a negative extemality oner Fle D. All of the answers are correct 11. Book value accounting is laely to increase the variabiliy of eanings of an FL A. TRUE B. FALSE 12. Which of the following statements is true? The book value of equity always equals the market value of oquity The book value of equity is used by regulation to examine capital a. b. adequacy more than market value equity The book value of equity equals par value plus urplus value minus retained earnings plus the loan loss reserve. All of the answers are true C. d. Losses in asset values due to adverse changes in interest nates are bome 13. initially by the equity holders of an FL liability holders of an FL. b. regulatory authorities d. C. taxpayers