Question

In what form are Certificates of Deposit issued?

Options

• Zero-Coupon Bonds issued on behalf of the central government

• Negotiable, unsecured instruments in bearer form

• Negotiable and transferable promissory notes

• Bills drawn by a seller and accepted by a buyer

Answer 1

Certificates of Deposit are negotiable, unsecured instruments in bearer form. Their form distinguishes them from Commercial Papers and Commercial Bills.