The economics of money, banking, and financial markets

 11.  What role does weak financial regulation and supervi-

sion play in causing financial crises?

 12.  Describe two similarities and two differences between the 

United States’ experiences during the Great Depression 

and the Great Recession financial crisis of 2007–2009.

 13.  What do you think prevented the financial crisis of 

2007–2009 from becoming a depression?

 14.  What technological innovations led to the development 

of the subprime mortgage market?

 15.  Why is the originate-to-distribute business model 

subject to the principal–agent problem?

 16.  True, false, or uncertain: Deposit insurance always and 

everywhere prevents financial crises.

 17.  How did a decline in housing prices help trigger the 

subprime financial crisis that began in 2007?

 18.  What role did the shadow banking system play in the 

2007–2009 financial crisis?