The currency outstanding account on the Fed's balance sheet
A)represents coins minted and issued by the Treasury and held by the Fed.
B)is an asset.
C)represents Federal Reserve Notes.
D)represents coins minted and issued by the U.S. Treasury and held by the commercial banking system.

Question

Quizplus · Accepted Answer

The currency outstanding account on the Fed's balance sheet represents the amount of Federal Reserve Notes in circulation, which are the paper currency issued by the Federal Reserve. Therefore, choice C is the correct answer. Choices A and D are incorrect because they refer to coins, which are a different form of currency than Federal Reserve Notes. Choice B is incorrect because the currency outstanding account is a liability, not an asset, on the Fed's balance sheet.

The Currency Outstanding Account on the Fed's Balance Sheet