Which statement about the New Deal's impact on the economy is supported by the material?

• A. It greatly improved infrastructure and helped recovery
• B. It eliminated the Great Depression immediately
• C. It reduced the banking system and increased bank failures
• D. It had no impact on infrastructure

Answer: (C)

The main idea here is how the New Deal changed the economy by reforming the financial system and investing in public works. The material shows that steps like closing destabilized banks for a time, then reforming the system with acts that created insurance for deposits and clearer rules for banking, helped restore confidence. Bank runs eased and bank failures fell after the most drastic actions were put in place, which means the banking system was being strengthened, not reduced or made more fragile. At the same time, New Deal programs funded infrastructure and public works—roads, bridges, dams, parks, and jobs for millions through agencies such as the Public Works Administration, CCC, and WPA—so the economy began to recover gradually, even if the Depression did not end overnight. So, the statement about the banking system being reduced and bank failures increasing isn’t supported by the material; the evidence points to stabilization of banks and a push to infrastructure and employment as the turning effects of the New Deal.