Which institution serves as the central bank of the United States?

Which institution serves as the central bank of the United States?

• A. Federal Reserve
• B. Federal Deposit Insurance Corporation
• C. Department of Treasury
• D. Office of Management and Budget

Answer: (A)

The Federal Reserve serves as the central bank of the United States, and its primary functions include regulating the nation's monetary policy, supervising and regulating banks and other financial institutions, maintaining financial stability, and providing financial services to the government and other financial institutions. Established in 1913, the Federal Reserve plays a crucial role in managing inflation, controlling interest rates, and ensuring the stability of the financial system. This institution's ability to influence money supply and credit conditions is essential for fostering a healthy economy. Other options listed serve different functions within the federal government but do not hold the role of a central bank. For instance, the Federal Deposit Insurance Corporation primarily provides deposit insurance to depositors in U.S. commercial banks, while the Department of Treasury manages national finances, and the Office of Management and Budget assists the President in preparing the federal budget.

The Federal Reserve serves as the central bank of the United States, and its primary functions include regulating the nation's monetary policy, supervising and regulating banks and other financial institutions, maintaining financial stability, and providing financial services to the government and other financial institutions. Established in 1913, the Federal Reserve plays a crucial role in managing inflation, controlling interest rates, and ensuring the stability of the financial system. This institution's ability to influence money supply and credit conditions is essential for fostering a healthy economy. Other options listed serve different functions within the federal government but do not hold the role of a central bank. For instance, the Federal Deposit Insurance Corporation primarily provides deposit insurance to depositors in U.S. commercial banks, while the Department of Treasury manages national finances, and the Office of Management and Budget assists the President in preparing the federal budget.