Which Characteristic of the Fed Was NOT Designed to Help

question 74

Multiple Choice

Which characteristic of the Fed was NOT designed to help maintain the Fed's independence?

• A) The Fed's actions are not subject to executive branch control. If the Fed chooses a course counter to what the president might wish, the president has no means to prevent it.
• B) Fed Board members are elected but confirmed by the president and the Senate. Board members do not have to worry about pleasing an electorate once elected and confirmed.
• C) Instead of going through the congressional appropriation process, the Fed's budget comes from its earnings on its open market operations.
• D) Board members serve 14-year terms and cannot be reappointed. The board members do not have an incentive to please Congress and the president in hopes of being reappointed.

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