On the Fed's balance sheet, the Fed's holdings of foreign exchange reserves
A)is an asset.
B)is a liability.
C)represents promises by the Fed to make loans to foreign governments.
D)consists of gold bars.

Question

Quizplus · Accepted Answer

The Fed's holdings of foreign exchange reserves are considered an asset on their balance sheet. These reserves are typically made up of foreign currencies and are held by central banks around the world. The Fed holds these reserves as a way to facilitate international trade and provide liquidity to foreign governments and central banks.

On the Fed's Balance Sheet, the Fed's Holdings of Foreign