Question

certificate of deposit (cd) accounts offer a wide range of benefits, but also have some drawbacks.
which one of these is a drawback of cds?
choose 1 answer:
a no access to your funds for a period of time
b limited number of free withdrawals
c lower interest rates than most other bank accounts
d can decrease in value if stock market drops

Explanation:

To determine the drawback of Certificate of Deposit (CD) accounts:

• Option A: CDs require you to keep funds deposited for a fixed term (e.g., 6 months, 1 year). During this term, you generally can't access the funds without incurring penalties. This is a key drawback.
• Option B: CDs typically don't have "free withdrawals" in the way checking/savings accounts might—withdrawals before maturity often have penalties, and they aren't structured around a "limited number of free withdrawals" like some accounts. So this is incorrect.
• Option C: CDs usually have higher interest rates than regular savings or checking accounts, so this is false.
• Option D: CDs are not tied to the stock market; their value (and interest) is fixed based on the agreement, so this is incorrect.

Answer:

A. no access to your funds for a period of time