You can buy a $50 savings bond today for $25 and redeem the bond in 10

You can buy a $50 savings bond today for $25 and redeem the bond in 10 years for its full face
value of $50. You could also put your money in a money-market account that pays 7% interest per
year.

Which option is better, assuming they are of equal risk?
A) The money-market account is better because it requires a smaller investment.
B) The money-market account is better because it pays more interest.
C) The savings bond is better because it earns a higher interest rate.
D) The money market and savings bond both earn 7% interest, so they are equal in value.

ANSWER

C