Praxis II Social Sciences Content Knowledge Exam Prep

Answer - C - The Federal Reserve System (sometimes just called “the Fed”) is the overarching, centralized banking authority within the United States.

Key Takeaway: Created in 1913 after a series of runs on banks spurred by financial panics, the Fed’s role is to create a monetary base to serve as currency and as bank reserves. The Federal Reserve serves a number of functions in monetary policies, such as providing loans to other banks. The Reserve also makes sure that other banks are following federal laws and banking practices. Finally, it controls the supply of money.