The Federal Reserve Was Established in 1913 to

question 167

Multiple Choice

The Federal Reserve was established in 1913 to

• A)prevent inflation by decreasing the money supply.
• B)stimulate the economy by increasing bank reserves.
• C)stop bank panics by acting as a lender of last resort.
• D)prevent bad loans by requiring banks to hold reserves.

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Definitions:

Unilateral Control

The exclusive power or authority one entity or country holds over another, without requiring consent or cooperation from the latter.

Significant Influence

The power to participate in the financial and operating policy decisions of an investee, without having control over those policies.

Fair Value

The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Jointly Controlled Operation

A joint operation where the parties that have joint control of the operation have rights to the assets, and obligations for the liabilities, relating to the arrangement.