SIE Exam Practice Question 803

Question: 803

Which of the following is correct regarding certificates of deposit (CDs)?

A. They are short-term securities that may be bought or sold in the open market at a market-determined price.

B. They typically invest in high-quality, short-term investments, such as commercial paper, Treasury bills, and money market funds.

C. They are known as "time deposits."

D. The financial institution typically pays a variable rate of interest for the term of the CD.