Page One Economics Question How is the interest on reserve balances rate a reservation rate? Banks should demand lower rates for their funds. Banks should not demand a higher rate for their funds, X Banks should not supply funds at a higher rate for their funds. Banks should not be willing to accept a lower rate for their fundsPage One Economics Question When the interest on reserve balances rate is higher than the federal funds rate, how will banks likely respond? X O Banks will seek to attract new funds from investors by offering the interest on reserve balances rate." Banks will withdraw from their account at their Federal Reserve Bank and lend the funds in the federal funds market. Banks will borrow in the federal funds market and deposit funds at their Federal Reserve Bank Banks will lend money to their best customers at the interest on reserve balances rate