With reference to certificate of deposit CD consider the following statements 1 They ...........

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With reference to certificate of deposit (CD), consider the following statements:

1. They are issued by banks for a period of less than one year.

2. They are tradable in the money market.

Which of the statements given above is/are correct?

1 only

2 only

Both 1 & 2

Neither 1 nor 2

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Explanation:

Both the statements are correct.
A certificate of deposit (CD) is a savings certificate with a fixed maturity date, specified fixed interest rate and can be issued in any denomination aside from minimum investment requirements. A CD restricts access to the funds until the maturity date of the investment.
A certificate of deposit is a promissory note issued by a bank. It is a time deposit that restricts holders from withdrawing funds on demand.