With regard to monetary policy, which of the following is under the direct control of the Federal Reserve's Board of Governors?
A)revising reserve requirements for depository institutions
B)authorizing changes in the amount of borrowing by the Treasury
C)monitoring the stock market for insider trading
D)monitoring the derivatives market for illegal trading strategies

Question

With regard to monetary policy, which of the following is under the direct control of the Federal Reserve's Board of Governors? ​
A)revising reserve requirements for depository institutions
B)authorizing changes in the amount of borrowing by the Treasury
C)monitoring the stock market for insider trading
D)monitoring the derivatives market for illegal trading strategies

Quizplus · Accepted Answer

The Federal Reserve's Board of Governors has direct control over revising reserve requirements for depository institutions. This is a tool of monetary policy used to influence the amount of funds that banks must hold in reserve against deposits, thereby affecting the bank's ability to lend and, consequently, the money supply.

With Regard to Monetary Policy, Which of the Following Is