Question

1. A CD in the financial sense is

Answer 1

Answer:

  1.  a certificate of deposit

  2.  multiply the principal by the interest rate and time

Step-by-step explanation:

1. A CD is a savings vehicle called a "Certificate of Deposit." It generally specifies a certain rate of interest for a given period of time. It usually carries an interest penalty for early withdrawal.

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2. The interest on a CD is calculated the way it is calculated for any other investment. The amount of interest in a given time is the product of the principal, the interest rate, and the time period. Interest on a CD with a period of more than 1 year is generally compounded. (The compounding interval will be part of the terms of the CD agreement.)