ECONOMICS
MONEY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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true
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false
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Either A or B
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None of the above
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Detailed explanation-1: -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-2: -Key Takeaways. The Federal Reserve, as America’s central bank, is responsible for controlling the supply of U.S. dollars. The Fed creates money by purchasing securities on the open market and adding the corresponding funds to the bank reserves of commercial banks.
Detailed explanation-3: -The Federal Reserve, the central bank of the United States, provides the nation with a safe, flexible, and stable monetary and financial system.
Detailed explanation-4: -The monetary base is usually measured by the central bank, which controls the circulation of currency in the economy.