One goal of the regulatory reforms that followed the 20072009 financial crisis was to address the "too-big-to-fail" problem associated with large institutions. How did the reforms try to address the problems?

Dodd-Frank attempts to limit the mechanisms for government bailouts. It does this through the following means:

Instructions: In order to receive full credit, you must make a selection for each option. For correct answer(s), click the box once to place a check mark. For incorrect answer(s), click the option twice to empty the box.

nstructions: In order to receive full credit, you must make a selection for each option. For correct answer(s), click the box once to place a check mark. For incorrect answer(s), click the option twice to empty the box.

check all that apply

• Subjects large institutions to regular stress testsunanswered
• Constrains Fed lending to individual banksunanswered
• Limits the FDICs guarantee powersunanswered
• Requires systemically important financial institutions (SIFIs) to have living willsunanswered

The reforms may not be sufficient because:

multiple choice

• The reforms do not clearly indicate that these large institutions cannot be bailed out.

• Investors may sense the government is unwilling to let these large institutions fail.

• The government is fundamentally unwilling to undertake bailouts itself.