A Level History - America - Practice Exam

What did the Reconstruction Finance Corporation primarily aim to help?

1. Small businesses and farmers

2. Only the top 7 banks

3. Large corporations and industries

4. Newly formed art institutions

The correct answer is: Only the top 7 banks

The Reconstruction Finance Corporation (RFC) was established in 1932 during the Great Depression with the primary aim of providing financial support to stabilize large corporations and industries. It was created to lend money to banks, railroads, and other businesses that were struggling during the economic downturn, helping to promote recovery by bolstering the financial systems and economic infrastructure. While the RFC certainly had the capability to impact a wide range of entities, its main focus was indeed on larger corporations and industries, as assisting them was seen as essential for overall economic recovery. This approach was based on the belief that helping these larger institutions would create a trickle-down effect, benefiting smaller businesses and the economy as a whole. The other options represent groups who were not the primary focus of the RFC's mission. Small businesses and farmers were certainly in need of assistance during the Great Depression, but the RFC’s resources were primarily directed towards larger entities due to their greater impact on the economy. Similarly, the RFC did not exclusively target banks as an entity, although it did support them, nor did it focus on newly formed art institutions, as its mission was anchored in economic recovery rather than cultural or artistic development.