Asked by Helmut Andres Florencia Roldan on Jun 16, 2024
Verified
Distinguish between a note and a certificate of deposit. How are they alike? How are they different? Explain your answer.
Certificate of Deposit
A bank-issued financial instrument that offers a fixed interest rate over a specified period of time.
Note
A written promise to pay a specified amount of money at a given time or on demand.
Distinguish
To recognize or treat as different in some respect due to distinct characteristics or features.
- Comparing and contrasting notes and certificates of deposit in terms of similarities and differences.
Verified Answer
TG
Tanesha GibbonsJun 21, 2024
Final Answer :
Notes and CD's are two-party instruments involving a maker and a payee. They are alike in that in each case one party promises to pay the other party money. They are different in that with a certificate of deposit, a bank is receiving money, acknowledging it, and promising to repay it. A CD is a specialized form of promissory note.
Learning Objectives
- Comparing and contrasting notes and certificates of deposit in terms of similarities and differences.