Question

someone is saving for a short - term financial goal, wants the ability to withdraw money at any time, and is not concerned with finding a high rate of interest. what is that persons best savings option?
○ bank savings account
○ certificate of deposit
○ money market account
○ mutual funds

Explanation:

To determine the best savings option, we analyze each choice:

• A bank savings account allows easy (any - time) withdrawals, has low - to - moderate interest rates, and is suitable for short - term goals as it provides liquidity.
• A certificate of deposit (CD) has a fixed term, and early withdrawal usually incurs penalties, so it's not good for on - demand withdrawals.
• Money market accounts often have higher minimum balance requirements and may have some restrictions on the number of withdrawals, and they are more focused on a balance between interest and liquidity but not as liquid as a basic savings account for on - demand needs.
• Mutual funds are investment vehicles, not savings accounts, and their value fluctuates with the market, so they are not suitable for short - term savings with on - demand withdrawal needs.

Answer:

A. bank savings account