Herb has $20,000 in an interest-bearing time deposit with the Applebottom Bank and Trust Company. While earning a relatively attractive rate of interest, Herb had to agree to not withdraw any of the funds until the end of a three-year period. Herb's investment represents a(n):

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Herb's investment represents a certificate of deposit (CD) as he has agreed to not withdraw any of the funds until the end of a three-year period. CD's typically offer higher interest rates than traditional savings accounts, but require customers to agree to leave their funds in the account for a set period of time.

Herb Has $20,000 in an Interest-Bearing Time Deposit with the Applebottom