Questions from Financial Markets

Q: “The more collateral there is backing a loan, the less

“The more collateral there is backing a loan, the less the lender has to worry about adverse selection.” Is this statement true, false, or uncertain? Explain your answer.

Q: Why can the provision of several types of financial services by one

Why can the provision of several types of financial services by one firm lead to a lower cost of information production?

Q: What causes bank panics?

What causes bank panics?

Q: How can financial liberalizations lead to financial crises?

How can financial liberalizations lead to financial crises?

Q: What role do weak financial regulation and supervision play in causing financial

What role do weak financial regulation and supervision play in causing financial crises?

Q: What types of risks do financial institutions face?

What types of risks do financial institutions face?

Q: Describe two similarities and two differences between the U.S.

Describe two similarities and two differences between the U.S. experiences during the Great Depression and those during the global financial crisis of 2007–2009.

Q: What technological innovations led to the development of the subprime mortgage market

What technological innovations led to the development of the subprime mortgage market?

Q: True, false, or uncertain: Financial engineering always leads to

True, false, or uncertain: Financial engineering always leads to a more efficient financial system.

Q: How did a decline in housing prices help trigger the subprime financial

How did a decline in housing prices help trigger the subprime financial crisis starting in 2007?