Ayesha received her tax refund and wants to put it aside to use for a down payment on a car that she will buy in a year or two. What would be a good place for Ayesha to put her money in, knowing her timeline for this goal? Choose 1 answer: A stocks or bonds B a CD (certificate of deposit) B C a bank account

## Step 1<br />Ayesha wants to save her tax refund for a down payment on a car that she plans to buy in a year or two. This indicates that she is looking for a short-term investment option.<br />## Step 2<br />Stocks and bonds are typically considered long-term investments due to their volatility and the time it takes to see significant returns. They are not suitable for short-term goals because they can fluctuate in value and there is a risk of losing the principal amount.<br />## Step 3<br />A CD (Certificate of Deposit) is a type of savings account that banks offer with a fixed term (often monthly, three months, six months, or one to five years), and a fixed interest rate. It is intended to help you save money while earning a small amount of interest. CDs are considered low-risk investments and are insured by the FDIC up to certain limits. They are suitable for short-term goals because they provide a fixed interest rate and a fixed term.<br />## Step 4<br />A bank account is a place where you can store your money. While it is safe and liquid, it typically offers little to no interest. Therefore, it is not the best option for saving money for a specific goal.<br />## Step 5<br />Given the options, a CD would be the best choice for Ayesha because it offers a fixed interest rate and a fixed term, making it suitable for her short-term goal of saving for a car down payment in a year or two.