Apentix/AP US History/Unit 7: Period 7 (1890-1945)/Question

AP US Historyhardmcq1 pt

Which of the following best explains why Congress created the Federal Reserve System in 1913?

A.To provide a central banking system that could regulate credit and respond to financial panics

B.To return the nation to the gold standard

C.To abolish all private banks

D.To enforce Prohibition

Explanation

Core Concept

Recurring panics, including the Panic of 1907, showed that the United States lacked a lender of last resort. The Federal Reserve Act created regional reserve banks able to adjust the money supply and supervise member banks.

Correct Answer

ATo provide a central banking system that could regulate credit and respond to financial panics

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