1. Suppose 26 of the securities are mortgage-backed securities. Suddenly we find out that this type of security exists in two versions, good and bad. The good are worth what we thought they would be worth. However, the bad is worth only half of what we thought. In addition, when presented with one of these securities, it is impossible to tell good or bad. What is the total value of BOAs securities now?

2. What is their bank capital after the mortgage-backed securities lost their value? can be a negative number

PART 1. Bank of America the flowing balance sheet Assets 20 Reserves 50 Securities 50 Loans 120 TOTAL Liabilities Deposits Borrowings Bank capital TOTAL 100 10 101 120 Support of Seous are more baded securities Suddenly we find out that this type of security in two versions, good and bad. The prodare worth what we thought they would be the badare worth only half of what we thought in addition, when presented with one of the securities. It is impossible to tell whether it is good Bayer for most o po buyers. What is the total value of Bank of America's securities now? PART 2: Bank of America had the following balance sheet before the mortgage backed securities lost value. Assets 20 Reserves 50 Securities 50 Loans 120 TOTAL Liabilities Deposits Borrowings Bank capital TOTAL 100 10 10 1201 What is their bank capital after the mortgage backed securities lost their value? (negative numbers are OK). 100 Assets 20 Reserves 50 Securities 50 Loans 120 TOTAL Liabilities Deposits Borrowings Bank capital TOTAL 10 10 120 PART 1. Bank of America the flowing balance sheet Assets 20 Reserves 50 Securities 50 Loans 120 TOTAL Liabilities Deposits Borrowings Bank capital TOTAL 100 10 101 120 Support of Seous are more baded securities Suddenly we find out that this type of security in two versions, good and bad. The prodare worth what we thought they would be the badare worth only half of what we thought in addition, when presented with one of the securities. It is impossible to tell whether it is good Bayer for most o po buyers. What is the total value of Bank of America's securities now? PART 2: Bank of America had the following balance sheet before the mortgage backed securities lost value. Assets 20 Reserves 50 Securities 50 Loans 120 TOTAL Liabilities Deposits Borrowings Bank capital TOTAL 100 10 10 1201 What is their bank capital after the mortgage backed securities lost their value? (negative numbers are OK). 100 Assets 20 Reserves 50 Securities 50 Loans 120 TOTAL Liabilities Deposits Borrowings Bank capital TOTAL 10 10 120