Small-Denomination Certificates of Deposits Are

question 337

Multiple Choice

Small-denomination certificates of deposits are

• A) included in M1 but not M2.
• B) included in M1 and M2.
• C) included only in M1.
• D) included in M2 but not M1.

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Definitions:

Simple Interest

Interest charged exclusively on the initial borrowed amount, or on whatever portion of the principal is still outstanding.

Compounded Annually

A method of calculating interest in which the interest earned on an investment is reinvested, and new interest is earned on that interest annually.

Compounding

The financial process where an investment earns interest not only on the principal amount but also on the accumulated interest over time.