Asked by stephanie santacruz on Jun 28, 2024
Verified
Malcolm wants to make a deposit into an account that earns interest.He wants to be able to access the money on a limited basis.What type of account should he NOT consider?
A) Money market account
B) Statement savings account
C) Certificate of deposit (CD)
D) Savings account
Certificate Of Deposit (CD)
A certificate that states there is a specific sum of money on deposit and guarantees the payment of a fixed interest rate after a certain period of time, usually seven days to ten years; deposits and withdrawals cannot be made with a CD.
Money Market Account
An account that pays a higher interest rate than other types of accounts, but usually requires a higher initial deposit and a higher minimum balance often with a limit on the number of transactions per month.
Statement Savings Account
A statement savings account is a type of savings account that provides the account holder with periodic statements, detailing transactions and balances.
- Evaluate different types of savings and investment accounts for specific savings goals.
Verified Answer
YG
Yanelly GuzmanJun 29, 2024
Final Answer :
C
Explanation :
A certificate of deposit (CD) typically locks in the deposited funds for a specific period of time, during which the account holder cannot access the money without incurring a penalty. Therefore, it is not a suitable option for Malcolm who wants limited access to his money. The other options, such as money market accounts, statement savings accounts, and regular savings accounts may offer limited access and/or earn interest, so they may be worth considering depending on specific features and requirements.
Learning Objectives
- Evaluate different types of savings and investment accounts for specific savings goals.