Economics: Today and Tomorrow © 2012

"Functions of the Fed"

Introduction
In this chapter you learned that the Federal Reserve serves as the central bank of the United States, and it sets the monetary policy that keeps our economy rolling. With the many tiers of the Federal Reserve System, it can seem confusing. However, its structure was created with the intent that it would be insulated from partisan interests. On the Web you can visit one of the Federal Reserve's regional branches to take a closer look at its structure and see how its system maintains safe banking conditions.

Destination Title: The Federal Reserve Bank of Chicago

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Directions
Start at The Federal Reserve Bank of Chicago Web site.

• Click on "About Us" at the top of the page and read through the information presented.
• Then, click on "Structure of the Federal Reserve System" on the right side and read the information.
• Browse through the site, taking notes you go.

1			How does the Fed work to keep prices stable?
2			How does the Fed help to maintain a sound banking system?
3			What features make the Federal Reserve similar to a private company?
4			How does the structure of the Fed guarantee a system of checks and balances?
5			The Federal Reserve System regulates the money supply, monetary policy, and banking safety in the United States. Imagine what would happen to the economy if the Fed ceased its operations. Write a report depicting what would happen to the money supply, the economy, and/or security in banking if the Federal Reserve no longer existed.