Title: QUIZ: The Financial Crisis of 2007 - 2009 -- The Federal Reserve and You
Course: Kelly's Copy-Export Course > Section: The Financial Crisis of 2007 - 2009 -- The Federal Reserve and You

Q: Which of the following was a major cause of the financial crisis that developed between 2007 and 2009?
- Oil prices dropped unexpectedly.
- The housing market bubble burst.
- The federal government failed to pay off its debts.
- The U.S. Treasury did not lend to businesses in need.
A: The housing market bubble burst.

Q: In order to ensure that credit could flow across the country when confidence in the financial system was eroding, the Federal Reserve acted to
- lower interest rates.
- limit government bailouts.
- increase lending requirements.
- stop further investment in housing.
A: lower interest rates.

Q: In response to the 2008 financial crisis, Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act, which was intended to
- boost economic activity and reduce unemployment.
- correct for gaps and weaknesses in financial regulation.
- limit the effect banks and financial institutions had on the economy.
- ensure that the Federal Reserve is not held responsible when financial crises occur.
A: correct for gaps and weaknesses in financial regulation.

Q: The 2008 financial crisis prompted Congress to transfer many of the Fed’s ______________ responsibilities, and those of other agencies, to the ______________________.
- banking regulation; U.S. Treasury Department (USTD)
- consumer protection; Office of Monetary Affairs (OMA)
- banking regulation; Federal Deposit Insurance Corporation (FDIC)
- consumer protection; Consumer Financial Protection Bureau (CFPB)
A: consumer protection; Consumer Financial Protection Bureau (CFPB)

Q: Unlike its initial response to the Great Depression, the Federal Reserve ensured that banks and financial institutions had sufficient ___________ throughout the 2008 financial crisis.
- loans
- liquidity
- currency
- investment
A: liquidity