Everything else held constant, in the market for reserves, decreases i

Everything else held constant, in the market for reserves, decreases in the interest rate paid on excess reserves affect the federal funds rate

A) when the funds rate is below the interest rate paid on excess reserves.
B) when the funds rate equals the interest rate paid on excess reserves.
C) when the funds rate is below the discount rate.
D) when the funds rate equals the discount rate.

ANSWER

B