The primary responsibility of the Federal Open Market Committee (FOMC)is to
A) establish a level and growth of the money supply through open market operations to produce a stable economic environment.
B) supervise the examination of state member banks.
C) change the reserve requirements of banks.
D) determine the level of Federal Reserve notes allowed in circulation.
E) None of the above.

Question

Quizplus · Accepted Answer

The primary responsibility of the FOMC is to establish a level and growth of the money supply through open market operations to produce a stable economic environment. This includes setting interest rates and adjusting the money supply to maintain price stability and promote maximum employment. Supervision of state member banks and changing reserve requirements are responsibilities of other Federal Reserve departments. Determining the level of Federal Reserve notes allowed in circulation is also not a primary responsibility of the FOMC.

The Primary Responsibility of the Federal Open Market Committee (FOMC)is