ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The Federal Reserve System, often referred to as the Federal Reserve or simply “the Fed, ” is the central bank of the United States. It was created by the Congress to provide the nation with a safer, more flexible, and more stable monetary and financial system.

Detailed explanation-2: -There are three key entities in the Federal Reserve System: the Board of Governors, the Federal Reserve Banks (Reserve Banks), and the Federal Open Market Committee (FOMC).

Detailed explanation-3: -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.

Detailed explanation-4: -The authors of the Federal Reserve Act found a fairly simple solution. Instead of banks keeping what they regarded as their reserve deposits with each other, have them keep their reserve deposits with a central federal bank called Federal Reserve Banks.

Detailed explanation-5: -The answer is A. The U.S Federal Reserve is responsible for the monetary and money supply. The Fed makes sure the economy is healthy and regulates the amount of money floating within the economy.