Customer AccountsQuestion 88 of 110
A customer wants to park six months of living expenses where the money is safe and available on short notice. Which fund best matches that objective?
a.A high-yield corporate bond fund
b.An aggressive growth fund
c.A money market fund
d.A long-term government bond fund
Explanation
Money market funds emphasize preservation of principal and same-day or next-day liquidity, which fits an emergency reserve. High-yield bonds carry substantial credit risk and growth funds substantial market risk. Long-term government bonds have little credit risk but significant interest rate risk, so their value can fall when the money is needed.
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