Use the Information Below to Answer the Following Question(s) -Based on the Average Utility, Which of the Following Is

question 34

Multiple Choice

Use the information below to answer the following question(s) . Below are four options for an investment decision. $$\begin{array} { | l | l | l | l | } \hline \text { Decision/Event } & \text { Rates Rise } & \text { Rates Stable } & \text { Rates Fall } \\\hline \text { Bank CD } & 0.80 & 0.80 & 0.80 \\\hline \text { Bond fund } & - 0.75 & 0.86 & 1.50 \\\hline \text { Index fund } & 0.00 & 0.90 & 1.20 \\\hline \text { Growth fund } & - 0.30 & 0.70 & 1.40 \\\hline\end{array}$$
-Based on the average utility, which of the following is considered the best decision?

• A) Bank CD
• B) Bond fund
• C) Index fund
• D) Growth fund

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Definitions:

Time Instrument

A financial document that specifies payment to be made at a future date.

Payee

The individual or entity to whom a payment is to be made.

Drawee

A drawee is the party in a transaction, usually a bank, upon whom a check or draft is drawn and is responsible for paying the specified amount.

Time-certain Requirement

A provision in a contract or agreement that specifies a precise time by which an obligation must be fulfilled.