Returns on Certificates of Deposits Linked to Performance of Stock

question 104

Multiple Choice

Returns on certificates of deposits linked to performance of stock markets are known as:

• A)equity CDs.
• B)stock CDs.
• C)market CDs.
• D)index CDs.
• E)exchange CDs.

---

Definitions:

Flow-through

A business entity that passes income to the owners or investors, avoiding corporate income tax, including S corporations, partnerships, and sole proprietorships.

C Corporation

A corporate legal framework where the entity is distinct for tax purposes from its owners or shareholders.

S Corporation

A type of corporation that meets specific Internal Revenue Code requirements, allowing profits, and some losses, to be passed directly to owners' personal income without being subject to corporate tax rates.

Rental Income

Income received from renting out property or equipment. This income is reportable and taxable.