What did the Federal Reserve Act of 1913 establish?

The Federal Reserve Act of 1913 established the Federal Reserve System, which is the central banking system of the United States. This act aimed to address the problems of monetary instability and bank failures that had plagued the economy, particularly during periods of financial panic. By creating the Federal Reserve, the legislation provided a more flexible money supply and a mechanism for regulating credit and managing inflation.

The Federal Reserve System consists of a network of 12 regional Federal Reserve Banks and a Board of Governors, which work together to oversee monetary policy, regulate banks, and provide financial services to depository institutions and the U.S. government. One of its key functions is to influence interest rates and oversee the money supply, thereby stabilizing the economy and preventing the kind of boom and bust cycles that had caused significant disruptions in the past.

In contrast, the other options address different aspects of U.S. economic history and policy but are not directly related to the main purpose or creation of the Federal Reserve Act. The cancellation of the gold standard, the introduction of income tax, and federal control over state banks occurred through separate legislation and are not the primary focus of this act.