Which of the Following Statements Is Correct

question 123

Multiple Choice

Which of the following statements is correct?

• A)To control the money supply,the Fed relies primarily on the reserve requirement.
• B)The discount rate is the rate of interest banks charge to their best customers.
• C)The Fed changes the reserve requirement frequently.
• D)Because the Fed has no way to earn income,it is dependent upon Congress for appropriations.
• E)Banks can turn a borrower's IOU into money--i.e.,they can create money.