Barron's Reading Page 161 Summarizing

What is the United States Federal Reserve System?

• It is a government agency that insures all national banks.

• It is a government agency that oversees national banks.

• It is a government agency that regulates oil refining and distribution.

• It s a government agency that oversees public education.

How does the Federal Reserve control monetary policy in the United States?

• It mints and distributes currency.

• It influences the costs of lending and borrowing money,

• It regulates the New York Stock Exchange,

• It creates financial policies for the executive branch of government.

True or false? All national commercial banks are required by law to be members of the Federal Reserve System.

• True

• False

Who appoints the seven - member board of governors that oversees the FRS?

• The US Supreme Court

• The US President and Senate

• The US Congress

• The Vice President and Speaker of the House

What happens when interest rates are high , inflation is high and unemployment goes up?

• The FDR stops selling securities.

• The possibility of a recession increases.

• Borrowing is inexpensive.

• Business activity increases.

True or false? The US Federal Reserve depends primarily on Congress for budget allocations and must report to Congress regularly on thr conduct of monetary policy.

• True

• False