Question

The Federal Reserve manages the nation’s currency and money supply by

manipulating interest rates and acting as a lender to banks.
overseeing bank collections and payments on loans.
dictating criteria and setting loan terms for banks.
offering investment advice and adjusting interest rates

Answer 1

manipulating interest rates and acting as a lender to banks.

The Fed controls the money supply via tools such as open-market operations, the discount rate and reserve requirements (and paying interest on reserves), and serves as lender of last resort to banks.