PLEASE ANSWER A THROUGH E.

5. In formation Asymmetry and Regulation: Financial Products Some blame the 2008 financial crisis on the inability of the government to regulate mortgage-backed securities (MBS) and credit default swaps (CDS) because the true costs of these were not known. Individuals and institutions thus were holding a lot more bad debt than they had thought. a) What inefficiencies are associated with the type of information asymmetry where the true costs are underestimated? b) Oftentimes the Secretary of the Treasury has experience working in private finance (big banks), can this be justified on grounds of alleviating information asymmetry? c) On the other hand, having such previous ties also can lead to critiques of agency loss. Explain this critique. d) Given the nature of government hiring and civil service protections, do you think that banks and other private financial institutions that can quickly invent new financial products can be successfully regulated by the government? e) How can regulations aimed at eliminating information asymmetries be justified on grounds of equality of opportunity? 5. In formation Asymmetry and Regulation: Financial Products Some blame the 2008 financial crisis on the inability of the government to regulate mortgage-backed securities (MBS) and credit default swaps (CDS) because the true costs of these were not known. Individuals and institutions thus were holding a lot more bad debt than they had thought. a) What inefficiencies are associated with the type of information asymmetry where the true costs are underestimated? b) Oftentimes the Secretary of the Treasury has experience working in private finance (big banks), can this be justified on grounds of alleviating information asymmetry? c) On the other hand, having such previous ties also can lead to critiques of agency loss. Explain this critique. d) Given the nature of government hiring and civil service protections, do you think that banks and other private financial institutions that can quickly invent new financial products can be successfully regulated by the government? e) How can regulations aimed at eliminating information asymmetries be justified on grounds of equality of opportunity