Define each of the following terms Too big to fail TBTF Red

Define each of the following terms

- Too big to fail (TBTF) Redlining

- Dodd – Frank Wall Street Reform and Consumer Protection Act of 2010

- Intellectual Capture

Solution

Q1. TOO BIG TO FAIL:

Too big to fail, a concept whereby a business has become so large that a government will provide assistance to prevent its failure because not doing so would have a disastrous ripple effect throughout the economy. If a large company fails, companies that rely on it for portions of their income might also be extinguished along with the employment they provide. Therefore, if the cost of a bailout is less than the cost of the failure to the economy, a government may decide a bailout.

Ex. Banks are so vital to the economy that it would be disastrous to the economy if the banks went bankrupt and thus the government would provide a bailout to the bank.

Q2. Dodd – Frank Wall Street Reform and Consumer Protection Act of 2010