This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Suppose you deposit money in a certificate of deposit (CD) at a bank. Which of the following ... (Read 149 times)

B

  • Hero Member
  • *****
  • Posts: 570
on: Jul 10, 2018
Suppose you deposit money in a certificate of deposit (CD) at a bank. Which of the following statements is TRUE?
 
  A) The bank is borrowing money from you without a promise to repay that money with interest.
  B) The bank is lending money to you with a promise to repay that money with interest.
  C) The bank is technically renting money from you with a promise to repay that money with interest.
  D) The bank is lending money to you, but not borrowing money from you.

Question 2

The phrase price to rent money is sometimes used to refer to ________.
 
  A) historical prices
  B) compound rates
  C) discount rates
  D) interest rates


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

helenmarkerine

  • Sr. Member
  • ****
  • Posts: 324
Reply #1 on: Jul 10, 2018
Answer to Question 1

Answer: C
Explanation: A) When you buy a CD, the bank DOES promise to repay both the principal and interest due.
B) When you buy a CD, the bank is NOT lending money to you but borrowing money from you.
D) When you buy a CD, the bank is renting or borrowing money from you; it is NOT lending money to you.

Answer to Question 2

Answer: D


B

  • Hero Member
  • *****
  • Posts: 570
Reply #2 on: Jul 10, 2018
TY


helenmarkerine

  • Sr. Member
  • ****
  • Posts: 324
Reply #3 on: Jul 10, 2018
Happy to Help


« previous next »
 

Did you know?

Always store hazardous household chemicals in their original containers out of reach of children. These include bleach, paint, strippers and products containing turpentine, garden chemicals, oven cleaners, fondue fuels, nail polish, and nail polish remover.

Did you know?

Liver spots have nothing whatsoever to do with the liver. They are a type of freckles commonly seen in older adults who have been out in the sun without sufficient sunscreen.

Did you know?

Critical care patients are twice as likely to receive the wrong medication. Of these errors, 20% are life-threatening, and 42% require additional life-sustaining treatments.

Did you know?

Many supplement containers do not even contain what their labels say. There are many documented reports of products containing much less, or more, that what is listed on their labels. They may also contain undisclosed prescription drugs and even contaminants.

Did you know?

The human body produces and destroys 15 million blood cells every second.

Formation of an oil deposit Formation of an oil deposit
Masaccio, The Tribute Money. Masaccio, The Tribute Money.
The West Bank Challenge The West Bank Challenge
A Radio Telescope in Green Bank, West Virginia A Radio Telescope in Green Bank, West Virginia
Raman has a line of credit loan with the ICICI bank. The initial loan balance was $72000.00. ... Raman has a line of credit loan with the ICICI bank. The initial loan balance was $72000.00. ...
Biological control agent: a commercially raised parasitoid wasp about to deposit a fertilized egg in Biological control agent: a commercially raised parasitoid wasp about to deposit a fertilized egg in
Video: Miller's reaction chamber experiment Animation

For a complete list of videos, visit our video library