ECONOMICS
FEDERAL RESERVE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Board of Governors
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Economists
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Free Open Market Committee
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Presidents of the Federal Reserve Banks
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Detailed explanation-1: -The Federal Reserve’s supervision activities include examinations and inspections to ensure that financial institutions operate in a safe and sound manner and comply with laws and regulations. These include an assessment of a financial institution’s risk-management systems, financial conditions, and compliance.
Detailed explanation-2: -The Federal Reserve Board, which is the governing body that manages the Federal Reserve System, oversees all domestic monetary policy.
Detailed explanation-3: -For depository institutions, they maintain accounts for reserve and clearing balances and provide various payment services, including collecting checks, electronically transferring funds, and distributing and receiving currency and coin. For the federal government, they act as fiscal agents.
Detailed explanation-4: -The primary way the Fed controls the monetary base is through open market operations: buying or selling securities. To increase the monetary base, the Fed buys securities from any party and pays with a check.