Basics of the Federal Reserve Quick Check

Question

4 of 54 of 5 Items
Question
Determine the statement that best describes the role of the Federal Reserve District banks.(1 point)
Responses

The district banks oversee the Board of Governors, set the target federal funds rate, and overlook the commercial banking industry.
The district banks oversee the Board of Governors, set the target federal funds rate, and overlook the commercial banking industry.

The district banks direct monetary policy, influencing the policies set by the Board of Governors and the Federal Open Market Committee.
The district banks direct monetary policy, influencing the policies set by the Board of Governors and the Federal Open Market Committee.

The district banks set the discount rate for lending between banks and oversee open market operations.
The district banks set the discount rate for lending between banks and oversee open market operations.

The district banks overlook the commercial banking industry and implement the policies from the Board of Governors and the Federal Open Market Committee

Answer 1

The statement that best describes the role of the Federal Reserve District banks is:

The district banks overlook the commercial banking industry and implement the policies from the Board of Governors and the Federal Open Market Committee.

This option accurately reflects the function of the district banks in the Federal Reserve System, which includes supervising and regulating commercial banks and implementing monetary policy as directed by the Board of Governors.