How are the locations of the twelve regional Federal Reserve Banks and the corresponding districts explained?
What will be an ideal response?
The explanation has three parts: one is population; the location and districting of the country very closely resembles the distribution of the population in 1914, with much of the population located east of the Mississippi river. The second explanation is economic forces; lawmakers realized it would be important to not have any one state coincide with a district, this would ensure a broad range of both geographic as well as industrial interests. The third reason is political; one of the authors of the Federal Reserve Act was from Richmond, Virginia, the location of a regional bank, and the Speaker of the House came from Missouri, the site of two regional banks.
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Trade surplus is the excess of exports over ________
A) capital outflows B) factor payments C) transfers D) imports
The purchase of an airplane produced in the United States by the government of Thailand is included in
A) U.S. imports. B) U.S. government purchases. C) U.S. exports. D) Thailand government exports.
Over time, nations tend to converge to
A) the same balanced growth path and same income per capita. B) the same balanced growth path but varying income per capita. C) different balanced growth paths but the same income per capita. D) different balanced growth paths because of varying income per capita.
In a simplified banking system in which all banks are subject to a 10 percent required reserve ratio, a $1,000 open market sale by the Fed to a bank would cause the money supply to:
a. increase by $1,000. b. increase by $100,000. c. decrease by $10,000. d. decrease by $1,000. e. remain unchanged.