A client has come to you inquiring about establishing a contingency fund for emergency purposes. She tells you that safety of principal is very important but so, too, is the possibility of a higher relative return and immediate liquidity. Which of these investments do you recommend and why?

A. A money market mutual fund, because it provides federally insured, safe, liquid funds

B. A 1-year certificate of deposit, because it may be redeemed without penalty at any time

C. A money market deposit account, because it provides a high rate of return with easy access to principal

D. A guaranteed investment contract (GIC), because it has a maturity of less than 1 year and offers a guaranteed high interest rate