Which of the following statements is correct?

A) To control the money supply,the Fed relies primarily on the reserve requirement.
B) The discount rate is the rate of interest banks charge to their best customers.
C) The Fed changes the reserve requirement frequently.
D) Because the Fed has no way to earn income,it is dependent upon Congress for appropriations.
E) Banks can turn a borrower's IOU into money.

Money Supply

The entire stock of currency and other liquid instruments circulating in a country's economy as of a particular time.

Fed

Short for the Federal Reserve System, it's the central banking system of the United States, responsible for monetary policy, including regulating banks, managing inflation, and influencing interest rates.

Reserve Requirement

The minimum amount of reserves that a bank must hold against its deposits, as mandated by central banking authorities to ensure liquidity.