Final answer:
In Illinois, brokers managing rental properties are typically required to pay interest on all security deposits they collect. The security deposits are held in an escrow account or a similarly protected account that accrues interest, which is later paid to the tenant. The correct multiple-choice option is (d).
Step-by-step explanation:
In the context of Illinois law, when a broker is hired to manage an apartment building, they are typically required to handle security deposits in a specific way. If Broker B is managing Landlord L's 16 unit apartment building, the broker would usually have to pay interest on all security deposits, which is mandated by Illinois law in certain residential real estate circumstances. This means that when tenants pay a security deposit, the broker must place it in an account that accrues interest, and then pay that interest to the tenants, usually on an annual basis.
In some states, brokers might be allowed to keep security deposits in their own escrow accounts to ensure that the funds are available to be returned to tenants upon the completion of their lease, provided there are no deductions for damages or other lease violations. As escrow accounts serve as a neutral holding space until an event is completed, they are also used for purposes like property taxes and home insurance payments in the context of homebuying, but for rentals, it specifically pertains to security deposits and any other funds held for the benefit of the parties involved. The correct multiple-choice option is (d).