ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Printing money is the job of the Federal Reserve, but only figuratively speaking. When the Fed decides to stimulate the economy by pouring more money into the system, it electronically transfers additional credits to the deposits of its member banks.

Detailed explanation-2: -Key Takeaways The job of actually printing currency bills belongs to the Treasury Department’s Bureau of Engraving and Printing, but the Fed determines exactly how many new bills are printed each year.

Detailed explanation-3: -The Fed controls the supply of money by increas-ing or decreasing the monetary base. The monetary base is related to the size of the Fed’s balance sheet; specifically, it is currency in circulation plus the deposit balances that depository institutions hold with the Federal Reserve.

Detailed explanation-4: -The U.S. central banking system-the Federal Reserve, or the Fed-is the most powerful economic institution in the United States, perhaps the world. Its core responsibilities include setting interest rates, managing the money supply, and regulating financial markets.