1. On April 2, 2009, the U.S. Financial Accounting Standards Board (FASB) agreed to give banks more flexibility in applying mark-to-market accounting to their toxic assets. The action by FASB came after Congressional pressure to help banks that have been forced to record billions of dollars in lower values for distressed assets because of frozen markets. As part of the agreement the FASB agreed to drop the presumption in mark-to-market accounting that all transactions in an inactive market are distressed unless proven otherwise. Using the concepts discussed in this course, defend the FASBs position.