2. Accounting: MTM vs Historical a. Suppose First National Bank has the following as the assets on their balance sheet (in millions). Do you think it is a good idea for First National to hold this many stocks, corporate bonds, and commodities as assets? Why or why not? Required Reserves $10 Excess Reserves $5 Mortgage Loans $20 Corporate Loans $15 Stocks $25 Commodities $25 b. If the housing market suddenly crashed, what type of change would you see in their balance sheet? Would First National be better off using a mark-to-market accounting system or the historical-cost system? c. If the price of commodities suddenly increased sharply, would First National be better off using a mark-to-market accounting system or the historical-cost system? d. What do your answers to parts (b) and (c) tell you about the tradeoffs between the two accounting systems