Question : Statement 1: Certificate of Deposit (CD) is issued by financial institutions.
Statement 2: CD is a type of government-issued security.
Option 1: Statement 1 is true, and statement 2 is true.
Option 2: Statement 1 is true, but statement 2 is false.
Option 3: Statement 1 is false, and statement 2 is true.
Option 4: Statement 1 is false, and statement 2 is false.
Correct Answer:
Statement 1 is true, but statement 2 is false.
Solution : The correct answer is (b) Statement 1 is true, but statement 2 is false.
Statement 1 is true. Certificates of Deposit (CDs) are indeed issued by financial institutions such as banks, credit unions, and other financial service companies.
Statement 2 is false. CDs are not a type of government-issued security; they are issued by private financial institutions, as mentioned in statement 1. CDs are time deposits offered by banks and are not backed by the government like certain other types of securities.
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