Which of the following statements about FDIC-insured accounts is correct? FDIC insures deposits up to $250,000 per person per bank All credit unions and retail banks provide FDIC-insured accounts Both A & B Neither A nor B

The correct answer is FDIC insures deposits up to $250,000 per person per bank.

The Federal Deposit Insurance Corporation was created by President Franklin Delano Roosevelt through the 1933 Banking Act of 1933 to restore the confidence of citizens in the private American banking system. This was due to the fact that before its creation, when a private bank went bankrupt, its account holders lost all their life savings. To avoid this tragic outcome, account holders would run to the bank that was experiencing financial difficulties and withdrew all their savings to protect themselves.

The FDIC only protects banks. Credit Unions have their own similar deferral insurance agency, the National Credit Union Administration or NCUA.