25-73 Which of the Following Is NOT a Reason for Using

question 86

Multiple Choice

25-73 Which of the following is NOT a reason for using a bad bank as a vehicle to add value in the loan sale process?

• A)Contracts for managers can be created to maximize the incentives to generate enhanced values from loan sales.
• B)The bad bank enables bad assets to be managed by loan workout specialists.
• C)The bad bank does not need to be concerned about liquidity needs since it does not have any deposits.
• D)Moving the bad loans off the balance sheet of the good bank will improve the markets perception,and thus performance,of the good bank.
• E)The good bank-bad bank structure increases information asymmetries regarding the value of the good bank's assets.

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Definitions:

American Medical Association

A leading professional group for doctors in the United States, focused on promoting the art and science of medicine and the betterment of public health.

Physician Aid in Dying

The practice where a physician provides a terminally ill patient with the means to voluntarily end their own life, within the bounds of legal and ethical guidelines.

Relieve Pain

To alleviate or reduce physical discomfort or suffering.

Stillbirth

Death of a fetus at or after the 20th week of gestation.