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What are interest-paying checking accounts and how do they work?

Most interest-paying checking accounts exhibit characteristics of both checking and savings accounts. Specifically, they earn relatively high rates of interest, especially compared with regular savings accounts, and allow relatively limited check-writing privileges. They are available through depository and nondepository institutions, including commercial banks, savings banks, credit unions, stock brokerage firms, mutual funds, and other financial services companies.

What are some of the important characteristics of the following four major types of interest-paying checking accounts?

The following tables shows abbreviations for the types of accounts:

Abbreviations
AMA: Asset Management Accounts	MMDA: Money Market Deposit Accounts
MMMF: Money Market Mutual Funds	NOW: Negotiable Order of Withdrawal

Use the following table to indicate which of the money market accounts is described in the statements.

	AMA	MMDA	MMMF	NOW
Funds invested in this account can be withdrawn at any time.
This account allows excess funds to be swept into higher interest ratepaying accounts.

Use the fundamental characteristics of the four major types of interest-paying checking accounts to assess the following scenario.

During a discussion about money market accounts with her coworker, Rina says that it is critically important to have access to the money market funds via an ATM.

In which account should Rina not invest?

A.) An MMMF B.) A NOW Account C.) An AMA

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