Question

In: Economics

Please answer all in mircrosoft word/or typing format Central Bank (US Federal Reserve Bank) Explain and...

Please answer all in mircrosoft word/or typing format

Central Bank (US Federal Reserve Bank)

Explain and discuss the significance of fractional reserve banking system and the 12 districts in the US Federal Reserve Banking System (Central Bank).

Solutions

Expert Solution

The Federal Reserve System is the central banking system of the United States.It was created to address banking panics.

Fractional-reserve banking is the practice whereby a bank accepts deposits, makes loans or investments, but is required to hold reserves equal to only a fraction of its deposit liabilities. Reserves are held as currency in the bank, or as balances in the bank's accounts at the central bank.It is only a fraction of bank deposits are backed by actual cash on hand and are available for withdrawal. This is done to expand the economy by freeing up capital that can be loaned out to other parties

The Federal Reserve System has a unique structure that is both public and private and is described as independent within the government rather than independent of government with 12 Districts, each with a separately incorporated Reserve Bank which is responsible for member banks located in its district. The size of each district was set based upon the population distribution by law.

Significant factors we're:

  1. Depository institutions-( transaction, or checking, accounts to the public, and may maintain accounts of their own at their local Federal Reserve Banks), thrifts, and credit unions; and
  2. Federal Reserve System advisory committees, which make recommendations to the Board of Governors and to the Reserve Banks regarding the System's responsibilities.

Related Solutions

Central Bank (US Federal Reserve Bank): Please explain in mircrosoft word/ typing format 1.Explain US Banking...
Central Bank (US Federal Reserve Bank): Please explain in mircrosoft word/ typing format 1.Explain US Banking History from 1776 to 2017.
Please answer all in microsoft word Explain the US Central Banking System and its functions. Explain...
Please answer all in microsoft word Explain the US Central Banking System and its functions. Explain the organization, how members of the board and chair are chosen, and their terms.
Please answer in microsoft word How does the US Central Bank compare to other Central Banks?
Please answer in microsoft word How does the US Central Bank compare to other Central Banks?
Briefly explain the role of the central bank (Federal Reserve) in the economy.
Briefly explain the role of the central bank (Federal Reserve) in the economy.
Please answer all in microsoft word/typing format c.Explain how a firm uses profit versus accounting profit....
Please answer all in microsoft word/typing format c.Explain how a firm uses profit versus accounting profit. .
Explain the pros and cons of the independence of a central bank. Should the Federal Reserve...
Explain the pros and cons of the independence of a central bank. Should the Federal Reserve be independent from the United States government? Why or why not?
The US central bank, the Federal Reserve, has two goals in mind when it makes monetary...
The US central bank, the Federal Reserve, has two goals in mind when it makes monetary policy, keep inflation and unemployment as low as possible. Why is there tension between these goals? What three tools does the Fed (not the Feds- that is the FBI) use to meet these two goals? If the Fed received data which insinuated that the unemployment rate was lower than the natural rate of unemployment, what might the Fed do in response to this information?...
The Federal Reserve (the Fed) is the central bank of the United States with the power...
The Federal Reserve (the Fed) is the central bank of the United States with the power to create money. When the Fed decides to increase the money supply by creating more money, how do they go about doing this? What role do banks play in this process? Where does the money come from to pay for all their purchases?
Question 1The Federal Reserve System is the central bank of the UnitedStates, an institution...
Question 1The Federal Reserve System is the central bank of the United States, an institution established by the Federal Reserve Act of 1913, the parameters of which can be amended by Congress. As a central bank, the key functions of the Fed are:-To advise the President and Congress on economic policy.-To conduct fiscal and monetary policy.-To conduct monetary policy, support financial system stability and provide banking services to banks and the federal government.-To manage and monitor the money supply.Question 2The...
The federal reserve system, also known simply as the fed, is the central bank of the...
The federal reserve system, also known simply as the fed, is the central bank of the united states. the fed has several important functions such as supplying the economy with currency, holding deposits of banks, lending money to banks, regulating the money supply, and supervising the banking system. explain how the federal reserve and the banking system creates money (i.e., increases the supply of money). is this an inherently inflationary practice? explain the factors that affect the demand for money.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT