Finance
What is the role of the Federal Reserve in mortgage markets?
AThe Fed directly sets mortgage rates
BThe Fed sets the federal funds rate which indirectly influences mortgage rates✓ Correct
CThe Fed insures mortgages
DThe Fed approves all mortgage applications
Explanation
The Federal Reserve sets the federal funds rate (the rate banks charge each other for overnight lending). While not directly setting mortgage rates, its monetary policy significantly influences the overall interest rate environment.
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