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What is the goal of the Federal Reserve? |
to achieve stable prices, full employment, and economic growth |
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What are the responsibilities of the Federal Reserve? |
monetary policy, regulate financial institutions, services to depository institutions, federal government, and the public |
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How many Federal Reserve regions are there? |
Twelve |
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What Federal Reserve region are we located in? |
region 5 |
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What do the Federal Reserve banks and branch offices do? |
carry out the day-to-day responsibilities of the Federal Reserve System |
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Who appoints the Board of Governors of the Federal Reserve System? |
the President, then they are confirmed by the Senate |
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What do the Board of Governors provide for the Federal Reserve System? |
leadership |
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The Federal Open Market Committee (FOMC) |
is responsible for making monetary policy decisions |
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Who makes up the FOMC? |
members of the Board of Governors AND presidents of the twelve reserve banks |
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Monetary Policy |
can lead to changes in the supply of money and the availability of credit |
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What can changes in the money supply influence? |
overall levels of spending, employment, and prices in the economy |
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What is the major policy tool of the Federal Reserve? |
open market operations (purchases and sales of government securities) |
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What are some other policy tools of the Federal Reserve? |
increasing or decreasing the discount rate charged on loans it makes to banks AND raising or lowering reserve requirements for those same financial instutions |
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What expansionary tools do the Federal Reserve use? |
buy bonds, lower discounts, lower reserve regulations |
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What contractionary tools do the Federal Reserve use? |
sell bonds, raise discount, raise reserve regulations |
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What does the Federal Reserve do to promote the safety and soundness of the banking system? |
supervise and regulate banks |
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Why else do the Federal Reserve supervise and regulate banks? |
foster stability in financial markets, and to ensure compliance with applicable laws and regulations |
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What other random duties do the Federal Reserve perform? |
– supply paper money and coin to banks – processing checks and electronic payments – protecting consumers through regulation and education |
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What is the most commonly used U.S. currency? |
$20 bill |
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The Federal Reserve System (the Fed) |
is the central banking system of the United States |
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What does the Federal Reserve System’s structure help to ensure? |
that regional information is represented in national policy decisions and that the Fed remains accountable to the people |
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