The FED is both centralized and decentralized in its structure. .pdf
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The Federal Reserve System features both centralized and decentralized elements, consisting of a central authority, the Board of Governors, and 12 regional Federal Reserve Banks. Monetary policy is crafted by the Federal Open Market Committee (FOMC), maintaining independence from political influence, as it does not require approval from Congress or the President. However, Congress retains the power to amend the laws governing the Fed and requires it to report on its policies.
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The FED is both centralized and decentralized in its structure. .pdf
- 1. "The FED is both centralized and decentralized in its structure." Do you agree? Why or why not? Be specific and limit your response to one paragraph. Solution The Federal Reserve System has a two-part structure: a central authority called the Board of Governors in Washington, D.C., and a decentralized network of 12 Federal Reserve Banks located throughout the country. Monetary policy is set by the FOMC, which includes members of the Board of Governors and presidents of the Reserve Banks. The Fed has been set up to ensure that monetary policy is insulated from political pressure. It is shielded from interference from other arms of the federal government. Policy and operational decisions do not require congressional or Presidential approval. The Fed’s operations are financed through its own resources rather than through congressional appropriations. Still, Congress has the power to change the laws governing the Fed. In addition, the Fed regularly reports to Congress on monetary policy and other matters. As such, the Fed is commonly described as “independent within the government.”