A document stating that the bank will pay the depositor a guaranteed interest rate for money left on deposit for a specified period of time is a:

Question

Quizplus · Accepted Answer

A certificate of deposit (CD) is a type of time deposit offered by banks and financial institutions. It is a document that guarantees the depositor a fixed interest rate on the money deposited for a specific period of time. CDs typically offer higher interest rates than regular savings accounts, but the depositor must agree to leave the money on deposit for the specified period in order to earn the guaranteed interest. Choice B (check) is incorrect as it is a negotiable instrument used for payment, not for earning interest on deposit. Choice C (line of credit) and D (revolving credit agreement) are also incorrect as they are forms of credit extended to borrowers, not deposits made by depositors.

A Document Stating That the Bank Will Pay the Depositor