SIE (Securities Industry Essentials) Practice Exam

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The Federal Reserve Board (FRB) functions include:

Setting monetary policy
Supervising and regulating banks
Maintaining the stability of the financial system
All of the above

The correct answer is: All of the above

The Federal Reserve Board (FRB) is responsible for setting monetary policy, supervising and regulating banks, and maintaining the stability of the financial system. These functions are essential for promoting economic growth and stability. Option A, setting monetary policy, refers to the FRB's role in controlling the supply of money and credit in the economy. Option B, supervising and regulating banks, means that the FRB oversees the activities of banks to ensure they are following regulations and managing financial risks appropriately. Option C, maintaining the stability of the financial system, highlights the FRB's responsibility to prevent financial crises and promote a healthy financial system. All of these functions are important for the overall functioning of the economy, making option D, "All of the above," the correct answer.