Which of the Following Statements Best Describes the Federal Reserve

question 9

Multiple Choice

Which of the following statements best describes the Federal Reserve role for banks?

• A)The Federal Reserve is a bank for banks.
• B)The Federal Reserve is the controller of all banks.
• C)The Federal Reserve is the auditor for all banks.
• D)The Federal Reserve provides money for banks.

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Definitions:

Open-end Investment Companies

Mutual funds that continuously issue new shares or redeem existing shares at the net asset value.

Mutual Funds

Funds that aggregate capital from numerous investors to acquire a varied collection of shares, bonds, or alternative financial instruments.

12b-1 Fee

A fee found in the expense ratio of some mutual funds, meant to cover marketing, distribution, and other costs.

Front-end Load

An upfront sales charge investors pay when they purchase mutual fund shares, which reduces the amount of the investment.