What was the creation of a national bank so important to US economy?

a. The national bank chartered states to print their own money.

b. The national bank controlled the money supply

c. The national bank took America off the gold standard

d. The national bank eliminated the need for privately owned banks

Question

History

Charlie Hampton

14 April, 11:29

What was the creation of a national bank so important to US economy?

a. The national bank chartered states to print their own money.

b. The national bank controlled the money supply

c. The national bank took America off the gold standard

d. The national bank eliminated the need for privately owned banks

+4

Answers (2)

Know the Answer?

Brayden Thompson · Answer 1

B: The national bank controlled the money supply

Nadia Caldwell · Answer 2

The correct answer is B. The creation of a national bank was so important to US economy because it controlled the money supply.

Explanation:

The United States, prior to the creation of the Federal Reserve, had a monetary and currency issuance policy distributed among the different states that made up the Union. This led to a dissimilar situation, in which the different states issued according to their needs, without effective control by the central government. This, in turn, led to an economic breakdown, due to the different values that each State granted to the currency.

Therefore, the creation of the Fed led to a unification of monetary and issuance policies, which led to a normalization of the American monetary system.