A long-term,fixed-rate certificate of deposit would be most appropriate when interest rates are moving up.

Question

Quizplus · Accepted Answer

A long-term, fixed-rate certificate of deposit locks in a specific interest rate for the entire term of the CD. If interest rates are rising, the rate on the CD will remain the same and may become less competitive with market rates. Therefore, it may be more appropriate to choose a shorter-term CD or a variable rate CD that can adjust to the changing interest rate environment.

A Long-Term,fixed-Rate Certificate of Deposit Would Be Most Appropriate When