Your Certificate of Deposit Will Mature in One Week and You

question 16

Multiple Choice

Your Certificate of Deposit will mature in one week and you are considering how to invest the proceeds.If you invest in a 30-day CD the bank will pay you 4%.If you invest in a 2-year CD the bank will pay you 6% interest.Which option would you choose?

• A) the 30-day CD,no matter what you expect interest rates to do in the future
• B) the 2-year CD,no matter what you expect interest rates to do in the future
• C) the 30-day CD if you expect that interest rates will fall in the future
• D) the 2-year CD if you expect that interest rates will fall in the future
• E) You would be indifferent between the 30-day and the 2-year CDs.

---

Definitions:

Medical Residents

Physicians in training who work in hospitals under supervision as part of their education to become fully licensed doctors.

Antimiscegenation Laws

Historical laws that prohibited interracial marriage and interracial sexual relations. These laws were designed to maintain racial purity and separation.

Immigration Rates

The frequency or number of individuals moving into a region or country from another country, typically measured per year.

Asian Men

Males of Asian heritage, this term encompasses a wide range of cultural, ethnic, and national backgrounds within the continent of Asia.