Federal Reserve Notes held by the Fed are considered part of the
A) money supply.
B) bank reserves.
C) both of the above
D) none of the above

Question

Quizplus · Accepted Answer

Federal Reserve Notes held by the Fed are not considered part of the money supply or bank reserves. The money supply consists of currency in circulation among the public and deposits, while bank reserves are funds that commercial banks hold in their accounts with the Federal Reserve. Federal Reserve Notes held by the Fed itself do not circulate among the public or contribute to commercial banks' reserves.

Federal Reserve Notes Held by the Fed Are Considered Part