Question : Which of the following is not a type of demand deposit account?
Option 1: Current account
Option 2: Saving account
Option 3: Fixed deposit account
Option 4: None of the above
Correct Answer: Fixed deposit account
Solution : The correct answer is (c). Fixed deposit account
Demand deposit accounts are accounts where funds can be withdrawn on demand without any specific maturity period. They are typically used for day-to-day transactions and provide easy access to funds.
A fixed deposit account, also known as a term deposit account, is not a demand deposit account. It is a type of time deposit where a specific amount is deposited for a predetermined period at a fixed interest rate. The funds in a fixed deposit account are not readily available for withdrawal before the maturity date without incurring penalties.
Fixed deposit accounts have a fixed maturity period and do not fall under the category of demand deposit accounts.
