Which of the Following Is Not True About Certificates of Deposit

question 87

Multiple Choice

Which of the following is not true about certificates of deposit (CDs) ?

• A) They pay higher interest than a saving account.
• B) They are only offered in denominations of $100,000 or more.
• C) They are not as liquid as a savings account.
• D) Funds are locked in for specific periods of time.

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Definitions:

Interest Rate

Interest Rate is the proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the loan outstanding.

Credit Cards

Financial instruments issued by banks that allow holders to borrow funds at the point of sale, intended for short-term financing with the obligation of paying back the borrowed amount plus interest.

M1

A category of the money supply that includes all physical money like coins and currency, as well as demand deposits, checking accounts, and negotiable instruments.

Debt

is an obligation that requires one party, the debtor, to pay money or other agreed-upon value to another party, the creditor.