1. True or False? If false, justify your answer.

a. The Dodd Frank Act increased the regulation of derivatives.

b. The McFadden Act of 1927 imposed a rigid separation between commercial and investment banks.

c. A Section 20 Affiliate is a securities subsidiary of a bank holding company through which a banking organization can engage in investment banking activities.

d. In the early 1980s, low interest rates led to disintermediation.

e. Liquidity risk is the risk that the promised cash flows from loans and securities held by FIs may not be paid in full.

f. Wholesale banking is business oriented while retail banking is consumer oriented.

g. Insolvency risk is the risk that a financial institution may not have enough capital to offset a sudden decline in the value of its assets relative to its liabilities.