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> XCO Colon Sales Liabilities Deposits $120 million Cash $20 million Long-term securities $70 million Long-term loans $50 million Net Worth $20 million Total $140

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> XCO Colon Sales Liabilities Deposits $120 million Cash $20 million Long-term securities $70 million Long-term loans $50 million Net Worth $20 million Total $140 million Total $140 million Suppose the economy goes into a recession, and many borrowers could not pay back the money that they borrowed from Star B Star Bank has $25 million of bad long-term loans. The value of the long-term loans of Star Bank becomes $25 million Fill in the table below, and show how the balance sheet of Star Bank is affected by the ovente described above. Assets Liabilities Cash Deposits Long-term securities Long-term loans Net Worth Total Total a) How are the shareholders of Star Bank affected by the recession and the bad loans? Explain b) How are the depositors of Star Bank affected by the recession and the bad loans? Explain For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac)

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