Income Intermediate: Money Market Deposit Accounts

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1.
Some holders of money market deposit accounts transition their funds to other retirement accounts with the hope of earning higher returns.
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True. Though returns are never guaranteed, some accountholders move their funds to other investments with the expectation of higher yields.
2.
The earnings on money market deposit accounts are generally competitive with those of which of the following investments?
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Certificates of deposit. Money market deposit account earnings are generally on a par with those of certificates of deposit.
3.
Why do money market IRAs have restrictions on when funds can be withdrawn?
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They may offer tax advantages. Because they are retirement accounts, they offer the possibility of tax deductibility or tax-deferral, and this requires restrictions on withdrawals.
4.
Which of the following does not use money market deposit accounts?
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None of the above. All of the parties above use them.
5.
In the money market, _______ debt investments are bought and sold.
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Short-term. Money market investments are short-term in duration.