Casey has $4,000 to invest in a certificate of deposit. Her local bank offers her 6.19% on a 12-month FDIC-insured CD. A nonfinancial institution offers her 6.84% on a 12-month CD. What is the risk premium? What else must Casey consider in choosing between the two CDs?

The risk premium is

Casey must also consider:

A. the bank's risk tolerance.

B. that if she needs access to the money in a short period of time, the nonfinancial institution's CD might be too risky.

C. that if she only needs access to the money after a long period of time, the nonfinancial institution's CD might be too risky.

D. the government's risk tolerance.