ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Certificate of Deposit (CD): Certificates of deposit or CD, allow you to save your money at a set interest rate for a pre-set period of time-which can range from a few months to several years.

Detailed explanation-2: -What is a CD account? A Certificate of Deposit (also known as a CD, COD, or Time Account) is a financial product that usually pays a fixed interest rate for a set period of time, ranging from a few months to several years. This period of time is known as a “term.”

Detailed explanation-3: -A term deposit is a type of deposit account held at a financial institution where money is locked up for some set period of time. Term deposits are usually short-term deposits with maturities ranging from one month to a few years.

Detailed explanation-4: -There are different types of savings accounts to choose from, and they’re not all alike. The options include traditional savings accounts, high-yield savings accounts, money market accounts, certificates of deposit, cash management accounts and specialty savings accounts.

Detailed explanation-5: -In Term Deposits, the sum of money is kept for a fixed maturity and the depositor is not allowed to withdraw this sum till the end of the maturity period. That is why they are called as Term Deposits because they are kept up to a particular term.