Everything else held constant, in the market for reserves, increases in the discount rate affect the federal funds rate

Everything else held constant, in the market for reserves, increases in the discount rate affect the federal funds rate

A) when the funds rate is below the discount rate.
B) when the funds rate equals the discount rate.
C) when the demand for federal funds intersects the vertical section of the reserve supply curve.
D) when the demand for federal funds equals zero.

Answer: The correct answer is when the funds rate equals the discount rate.

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