Praxis 5004 Practice Test Practice Question
Which of the following best describes the role of the Federal Deposit Insurance Corporation?
Correct Answer: D
Rationale: The Federal Deposit Insurance Corporation (FDIC) insures bank deposits, ensuring that depositors do not lose their savings in the event of a bank failure. This role is crucial for maintaining public confidence in the banking system, as it protects consumers' funds.
Option A is incorrect because the FDIC does not involve presidential emergency powers over banks. Option B misrepresents the FDIC's function; it does not separate different types of deposits. Option C is also inaccurate, as the FDIC does not regulate stock trading; this is the role of the Securities and Exchange Commission (SEC).
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