Question

Which of the following are functions of the Federal Reserve? Check all that apply. Maintaining federal government checking accounts and gold Maintaining and circulating currency Ensuring all banks make a profit Making a profit for the federal government Being the lender of last resort for banks

Answer 1

Answer:

1. Maintaining federal government checking accounts and gold.

2. Maintaining and circulating currency.

3. Being the lender of last resort for banks

Explanation:

The Federal Reserve System (the 'Fed) was created by the Federal Reserve Act, passed by Congress in 1913. The Fed began operations in 1914. It was founded by President Woodrow Wilson under the Federal Reserve Act, which was aimed at backing each banks in order to put a definitive end to the bank panics of the 1800s.

The following are functions of the Federal Reserve;

1. Maintaining federal government checking accounts and gold.

2. Maintaining and circulating currency.

3. Being the lender of last resort for banks.

Additionally, it comprises of twelve (12) Federal Reserve Bank regionally across the United States of America and seven (7) board of governors.