Tony gives Sonora a check for $500. Sonora deposits it in her local bank, which transfers the check to the Federal Reserve Bank in Chicago, which transfers it to Tony's bank in Wisconsin. What type of bank is the Federal Reserve Bank in this situation?

Question

Quizplus · Accepted Answer

The Federal Reserve Bank acts as an intermediary or collecting bank when it facilitates the transfer of funds from one bank to another, as in the process of clearing a check from the depositor's bank to the payer's bank.

Tony Gives Sonora a Check for $500