ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Money market deposit accounts have a minimum balance requirement and are limited to a certain number of transactions each month (less than a savings account). Therefore, money market deposit accounts are less liquid than checking and savings accounts. CD’s are offered by depository institutions.

Detailed explanation-2: -What is a Tiered Money Market Account? A tiered money market account is one that offers different rates at different dollar amounts. As a result, the rate you get depends on the amount of money you have in the account. This might differ from the rate the bank is advertising.

Detailed explanation-3: -What Is a Tiered-Rate Account? A tiered-rate account is a bank account that pays different rates of interest, depending on the amount of the funds held in it. It can be any type of account but usually is either a money market or a savings account.

Detailed explanation-4: -Minimum balance and fee: The minimum opening deposit for a money market account is $2, 500, but beyond the initial deposit, there is no requirement to maintain a minimum balance.

Detailed explanation-5: -Tiered Interest Rate Method-Type One: Interest credited based on annuity’s value (e.g., 2% for the first $50, 000 of cash value, 2.2% for the next $50, 000, etc.). Tiered Interest Rate Method-Type Two: Interest credited at one rate if owner later annuitizes but a lower rate if contact is surrendered.