A two-party negotiable instrument that is a special form of note created when a person deposits money at a financial institution in exchange for the institution's promise to pay back the amount of the deposit plus an agreed-on rate of interest upon the expiration of a set time period agreed upon by the parties is known as a ________.
A) collateral note
B) check
C) certificate of deposit
D) bill of exchange

Question

Quizplus · Accepted Answer

A certificate of deposit is a two-party negotiable instrument created when a person deposits money at a financial institution in exchange for the institution's promise to pay back the amount of the deposit plus an agreed-on rate of interest upon the expiration of a set time period agreed upon by the parties.

A Two-Party Negotiable Instrument That Is a Special Form of Note