Why is it the Fed’s responsibility to set interest rates, not national banks? (1 point)
Responses
A. The Fed is responsible for printing all money.
B. There are not very many national banks, so few are qualified
C. The Fed consults national banks, but they do not make the final decisions.
D. National banks are for profit, so they are not looking at the overall economy.
C. The Fed consults national banks, but they do not make the final decisions.
The Federal Reserve, as the central bank of the United States, is tasked with promoting a healthy economy through stabilizing prices, maximizing employment, and moderating long-term interest rates. National banks are for-profit institutions focused on their own bottom line, and may not always have the overall economy's best interests in mind when setting interest rates. The Federal Reserve, on the other hand, has a broader view of the economy and is therefore mandated to set interest rates to achieve its goals.