Which of the following is a correct statement regarding the balance sheet of the Federal Reserve?
A) Fed assets = Fed liabilities + Federal Reserve notes
B) Fed assets = Fed liabilities + Fed capital accounts
C) Fed assets = Fed liabilities + bank reserves
D) Fed assets = bank reserves + Federal Reserve notes outstanding

Question

Quizplus · Accepted Answer

The balance sheet of the Federal Reserve equates its assets to its liabilities plus its capital accounts. This reflects the accounting equation where assets are funded by liabilities and equity (in this case, the Fed's capital accounts).

Which of the Following Is a Correct Statement Regarding the Balance