The fed has created $3 trillion of bank reserves. draw a curve that shows the supply of bank reserves. label it rs. the current federal funds rate is 0.2 percent. suppose that when the federal funds rate is greater than 0.2 percent, a fall in the federal funds rate increases the quantity of reserves demanded, but a further open market purchase of securities fails to change the federal funds rate. draw the demand curve for bank reserves that illustrates this fact. label it rd. > > > when using the multi-point drawing tool, press escape to release the drawing tool. draw a point to show the current federal funds rate and the equilibrium quantity of reserves.