Which law established the Federal Trade Commission to enforce consumer protection and fair competition?

• A. The Federal Trade Commission Act (1914)
• B. The Sherman Antitrust Act (1890)
• C. The Clayton Antitrust Act (1914)
• D. The Pure Food and Drug Act (1906)

Answer: (A)

This question centers on who created a federal watchdog to police business practices and protect consumers, with a broad mandate across industries. The Federal Trade Commission Act of 1914 established the Federal Trade Commission as an independent agency charged with enforcing laws against unfair methods of competition and deceptive or unfair acts or practices in commerce. This gave the government a standing, centralized authority to monitor and curb abuses by big businesses, rather than relying solely on private lawsuits or criminal prosecutions.

The other laws contributed in important ways to antitrust enforcement and consumer protection in specific areas, but they did not establish a general regulatory body dedicated to fair competition. The Sherman Act (1890) and Clayton Act (1914) targeted monopolistic practices and specific anticompetitive behaviors, primarily through courts and injunctions. The Pure Food and Drug Act (1906) focused on labeling and safety in food and drugs, not on broad competition oversight.