Question

The Federal Reserve's organization While all members of the Federal Reserve Board of Governors vote at Federal Open Market Committee (FOMC) meetings, only of the regional bank presidents are members of the FOMC. Which of the following contributes to making the Federal Reserve an independent policymaking body?
a. Its role is written into the U.S. Constitution.
b. Members of the Board of Governors are appointed for 14-year terms.
c.There are 12 Federal Reserve banks.

The Federal Reserve's primary tool for changing the money supply is__________ . In order to increase the number of dollars in the U.S. economy (the money supply), the Federal Reserve will _________government bonds.

Answer 1

Answer: 1. five,

b. Members of the Board of Governors are appointed for 14-year terms.

2. open market operation

buy

Explanation: The Federal Reserve Board of Governors vote at FOMC meetings but only 5 of the regional bank president are members of the FOMC. One of the reasons that the Federal Reserve is able to maintain its independence is that members of the Board of Governors are appointed for 14-year terms.

The FOMC is made up of 12 members  and the Board of governors regulates their operations.

The Federal Reserve controls the three tools of monetary policy. These are open market operations, the discount rate and the reserve requirements but use open market operations to control the the money supply. When the  Federal Reserve wants to increase the supply of money in circulation, they buy back  government bonds, putting money in the hands of the public.