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Rebecca's $5000 CD is nearing its maturity and will have a maturity value of $6101.89. The renewal rate for her CD will be at a historic low and will lock up her money for another 5 years. Which option should Rebecca choose for her CD?

A. Termination
B. Automatic Renewal
C. Withdrawal
D. Reinvestment

Respuesta :

Withdrawl
  

That's the apex answer

Answer:

Withdrawal or reinvestment

Step-by-step explanation:

Given that Rebecca has 5000 deposit with MV 6101,89,

The renewal rate is very low since it is at a historic level.

The question is to advise REbecca to decide

Since renewal is at a very low rate, and that too for another 5 years, renewal is not at all advisable.

But considering reinvestment if the current interest rate is very good, and there is an option for flexible selection of period insteal of fixed 5 years, reinvestment would be a good option.

In other cases, it is advisable to withdraw and not renew.