If You Need Access to Your Funds in Two Years

question 127

Multiple Choice

If you need access to your funds in two years or less, which of the following investments would be least appropriate?

• A) Cash
• B) Certificates of deposit
• C) Short-term government bonds
• D) Highly rated corporate bonds
• E) Stocks and mutual funds

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Definitions:

Marginal Cost

The financial outlay required to produce an additional unit of a good or service.

Gasoline

A transparent, petroleum-derived liquid that is used primarily as a fuel in most spark-ignited internal combustion engines.

Car Wash

A facility for cleaning vehicles, typically involving an automated system with brushes and water jets or a manual cleaning by workers.

Marginal Decisions

Decisions made based on the additional benefit or cost of consuming or producing one more unit of a good or service.