8
QuizMultiple Choice

Investment Strategies — Unit test

Question 8 • * HSA 26-27 Economics

One advantage to buying a CD is that it

Answer
A
can be purchased for different amounts.
B
is high risk but comes with great rewards.
C
can be used for long-term retirement.
D
is high risk but backed by the government.

Explanation

A certificate of deposit (CD) can be opened with different deposit amounts, depending on the bank and the account terms. CDs are generally considered low-risk savings products, not high-risk investments, so choices B and D are incorrect. A CD may have a fixed term and early-withdrawal penalties, which makes it less suited to retirement planning as a sole long-term investment.

AI-written and checked against the verified answer.

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