Georgia Assessments for the Certification of Educators GACE Practice Test

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Which of the following best describes Congress' purpose in setting up Freddie Mac in 1970?

Creating a place for small businesses to get loans
Deregulating the credit market
Expanding opportunities for home ownership
Improving regulation of the Internet

The correct answer is: Expanding opportunities for home ownership

The purpose of Congress in establishing Freddie Mac in 1970 was to expand opportunities for home ownership. Freddie Mac, officially known as the Federal Home Loan Mortgage Corporation, was created to promote access to home financing, thus allowing more individuals and families to purchase homes. This was achieved by providing liquidity, stability, and affordability to the mortgage market, especially in times of economic uncertainty. By purchasing mortgages from lenders, Freddie Mac ensures that there are funds available for lenders to provide new loans, which in turn helps stimulate the housing market and makes home buying more accessible to the general public. This initiative was particularly significant in the context of the social and economic climate of the time, as it aimed to encourage home ownership as a key aspect of the American Dream.