Which agency was developed to regulate banking and investment activities?

• A. Federal Deposit Insurance Corporation
• B. Securities and Exchange Commission
• C. Tennessee Valley Authority
• D. Civilian Conservation Corps

Answer: (A)

After the Great Depression, the U.S. created agencies to stabilize the financial system and restore confidence. The Federal Deposit Insurance Corporation was formed to insure bank deposits and to oversee banks, helping prevent runs on banks by protecting depositors and enforcing safety standards. This role directly targets banking, making it the agency most associated with regulating banks and maintaining financial stability in that sector.

The Securities and Exchange Commission, by contrast, was established to regulate the securities markets and protect investors, not banks. The Tennessee Valley Authority focuses on electricity and regional development, while the Civilian Conservation Corps was a work-relief program. So, for regulating banking activities, the FDIC is the best fit among these options.