Your Chartered Bank Is Offering a One-Year GIC with an Interest

Multiple Choice

Your chartered bank is offering a one-year GIC with an interest rate of two percent, and a one-year cashable GIC for one and a half percent. Canada Savings Bonds (CSB) are paying one percent. You have $10 000 to invest of which you feel $5 000 is ample for emergency fund purposes. How should you invest your funds given the options above?

A) $5 000 in the one-year GIC and $5 000 in CSBs
B) $5 000 in the one-year GIC and $5 000 in the one-year cashable GIC
C) $10,000 in the one-year GIC
D) $10,000 in the one-year cashable GIC