The DI can influence the withdrawal rates of NOW accounts through explicit interest payments, implicit interest payments, or minimum balance requirements.

Question

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The statement is true. The DI can influence the withdrawal rates of NOW accounts through explicit interest payments, implicit interest payments, or minimum balance requirements. Explicit interest payments are interest payments that are explicitly stated, while implicit interest payments are interest payments that are included in the account's fees or charges. Minimum balance requirements can influence withdrawal rates because if a customer does not maintain the required minimum balance, they may face penalties or restrictions on their ability to withdraw funds.

The DI Can Influence the Withdrawal Rates of NOW Accounts