Good Day Sir.I need answers of following Case Study.Thank You so much.Rise and Fall and (Partial) Rise of the Checking AccountIn 1960, plain-vanilla demand deposits, which pay no interest, made up more than half of commercial bank liabilities. The following graph shows checkable deposits as a fraction of all bank liabilities for the period from January 1973 to June 2016. Although there were some fluctuations over the years, by and large, until the beginning of the financial crisis, checkable deposits made up a declining fraction of bank liabilities. By 2008, they reached a low point of a little more than 6% of all bank liabilities. Then the financial crisis hit, and households and firms began putting more funds into checkable deposits, so that by 2016, they had risen to more than 13% of bank liabilities.The long-run decline in the popularity of checking accounts until the financial crisis may seem puzzling because, in some ways, these accounts became more attractive over time. In the 1960s and 1970s, the only checkable deposits available were demand deposits, which paid no interest. Interest-paying NOW accounts were authorized by changes in bank regulations that took effect in 1980. In addition, because there were no ATMs in those days, to withdraw money from your checking account, you needed to go to your bank, stand in line, and fill out a withdrawal slip. Banks were typically open only during "banker's hours" of 10 A.M. to 3 P.M. from Monday to Friday. If stores or restaurants declined to accept checks?as many did?consumers could not spend the funds in their accounts. Today, debit cards make it possible for consumers to access the funds in their checking accounts even when buying from a store that doesn't accept checks.Until the financial crisis, to many households and firms, the improved services that checking accounts provided were more than offset by alternative assets that offer higher interest rates. The following graph shows households' and firms' holdings of various short-term financial assets in July 2016. Even though checkable deposits have increased in popularity in recent years, the value of savings accounts and small time deposits (CDs of less than $100,000) was nearly five times greater than the value of checkable deposits.Households hold less in checking accounts relative to other financial assets than they once did, partly because households have become wealthier over time. With greater wealth, households have been better able to afford to hold assets, such as CDs, where their money is tied up for a while but on which they earn a higher rate of interest. Money market mutual funds, such as Vanguard's Prime Money Market Fund, which were first introduced in 1971, have also been popular. Like other mutual funds, money market mutual funds sell shares to investors and use the funds to buy financial assets. These funds buy only money market?or short-term?assets, such as Treasury bills and commercial paper issued by corporations. Money market mutual funds pay higher interest than bank deposit accounts, and they also allow for limited check writing, so they have been formidable competition for bank checking accounts.The 2007?2009 financial crisis showed that checking accounts are still useful to households and firms, however, Checking accounts provide a safe haven for households and small businesses because their funds are protected up to the $250,000 federal deposit insurance ceiling. In addition, very low interest rates persisted for years after the end of the recession of 2007?2009. The interest rate on three-month CDs, which had been about 5% at the end of 2007, was only 0.15% in 2016. Similarly, yields on money market mutual funds, which had been about 5% in 2007, were only about 0.20% in 2016. As a result, many households moved their funds from CDs and money market mutual funds to checking accounts to take advantage of their greater liquidity without giving up much interest.Bank AssetsBanks acquire bank assets with the funds they receive from depositors, the funds they borrow, the funds they acquire from their shareholders purchasing the banks' new stockCase Study: Question: Analyse the Case study and Answer the questions with relevant example. In 1960, federal regulations prohibited banks from paying interest on checking accounts. Banks are now legally allowed to pay interest on checking accounts, yet the value of checking accounts has shrunk from more than 50% of commercial bank liabilities in 1960 to about 13% today. Because checking accounts now pay interest, shouldn't they have become more popular with households rather than less popular? Briefly explain.

35% 30 25 20 15 10/ 5 1973 1975 1980 1985 1990 1995 2000 2005 2010 2015 $10,000 9,000 Billions of dollars 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 Currency Large time Checkable Money market Savings deposits deposits mutual fund accounts and shares small time deposits