Which of the following statements best describes the twelve Federal Reserve Banks?

A) They are privately owned and privately controlled central banks whose basic goal is to provide an ample and orderly market for United States Treasury securities.
B) They are privately owned and publicly controlled central banks whose basic function is to minimize the risks in commercial banking in order to make it a reasonably profitable industry.
C) They are privately owned and publicly controlled central banks whose basic goal is to control the money supply and interest rates in promoting the general economic welfare.
D) They are privately owned and publicly controlled central banks whose basic goal is to earn profits for their owners.
E) They are publicly owned and publicly controlled central banks whose basic goal is to provide income for the Treasury.

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Meghan Nader · Accepted Answer

Final Answer : C, Explanation :  The twelve Federal Reserve Banks are privately owned and publicly controlled central banks whose primary goal is to control the money supply and interest rates in promoting the general economic welfare. They were created by Congress in 1913 to prevent bank panics and to act as a lender of last resort. While they do earn profits, those profits are returned to the Treasury after expenses and statutory dividends are paid to member banks.

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