If Gus believes interest rates are going to fall in the near future and remain low for several years,Gus should now
A)invest in a variable-rate certificate of deposit.
B)invest in a long-term, fixed-rate certificate of deposit.
C)invest in a short-term, fixed-rate certificate of deposit.
D)bury his money in fruit jars in the back yard.

Question

Quizplus · Accepted Answer

If Gus believes interest rates are going to fall and remain low, investing in a long-term, fixed-rate certificate of deposit would lock in the current higher rates before they decrease, maximizing his interest income over time.

If Gus Believes Interest Rates Are Going to Fall in the near Future