Final answer:
The Reserve Bank Board's primary functions are to manage monetary policy for financial stability and economic health, targeting low unemployment and low inflation. The correct answer is Option 1, as economic growth, price stability, and full employment are directly tied to a central bank's mandates.
Step-by-step explanation:
The Role of the Reserve Bank Board
The Reserve Bank Board is instrumental in ensuring monetary and banking policy contributes to specific macroeconomic goals. The Board’s primary responsibility includes conducting monetary policy to maintain financial system stability, providing banking services to various institutions, and managing the nation's banking system to safeguard depositors. When making decisions about the money supply, the central bank influences macroeconomic policy with the dual objective of maintaining low unemployment and low inflation. It accomplishes this by determining interest rates which affect the cost of credit and the broader economy. Furthermore, the fractional reserve system is utilized to regulate the amount of money banks can lend, which helps in managing the overall money supply.
Given these functions, the correct answer is Option 1: Economic growth, price stability, and full employment. These aims are central to the core mandates of the Federal Reserve and similar institutions, unlike the goals detailed in the other options which are outside the direct purview of traditional central bank mandates.