Which policymaking institution determines the money supply, sets the rules for how checks are cleared and how banks obtain new currency, and determines what activities banks may or may not engage in?

Question

Quizplus · Accepted Answer

The Federal Reserve System, commonly referred to as the Fed, is the policymaking institution responsible for determining the money supply, setting rules for the clearing of checks and the issuance of new currency, and regulating bank activities. The Treasury Department is responsible for managing government finances and issuing bonds and securities. The Commerce Department oversees economic development and trade. The Securities and Exchange Commission regulates the securities industry and enforces securities laws.

Which Policymaking Institution Determines the Money Supply, Sets the Rules