Chapter 15.1, Problem 3R

To determine

To discuss: The major function of the Fed.

Explanation of Solution

The Federal Reserve System is the US central bank. This implements five general features to facilitate efficient working of the economy of U.S. and, more generally, this conducts national monetary policy to ensure full employment, competitive economies, and sustainable long-term rates of interest by managing credit and currency conditions in the economy of the U.S. Guidance and supervision of financial corporations to ensure U.S. financial system and banking stability and to protect consumers' credit rights, offering financial services to depository institutions, the foreign official institutions and U.S. government playing an chief role in the growth of the payment system in the national level.

Economics Concept Introduction

Introduction: The money market is for securities dealing in very short-term debts. That includes wholesale-level large-volume transactions between banks and traders. This also includes money market accounts opened by bank customers and mutual money market funds bought by single investors at the retail stage.