The sum of Federal Reserve notes, coins, and depository institutionsʹ reserves is the .
A) monetary base
B) reserves of the Fed
C) liabilities of the Fed
D) assets of the Fed

Question

Quizplus · Accepted Answer

The monetary base is the sum of Federal Reserve notes (currency in circulation), coins (minted by the U.S. Treasury), and depository institutions' reserves held with the Federal Reserve Banks. Therefore, the correct choice is (A) monetary base. The other options (B) reserves of the Fed, (C) liabilities of the Fed, and (D) assets of the Fed are specific components of the monetary base but not the total sum of it.

The Sum of Federal Reserve Notes, Coins, and Depository Institutionsʹ