Question

Which of the following is not a one-time investment?

• A. National Savings Certificate
• B. Fixed Deposits
• C. Recurring Deposits
• D. Kisan Vikas Patra

Hint:

Associate "Recurring" with "repeating" or "regular." This will help you remember that Recurring Deposits (RDs) involve making deposits repeatedly over a period, distinguishing them from lump-sum investments like FDs.

Answer 1

The Correct Option is C

Step 1: Understanding the Concept:
A one-time investment involves depositing a lump sum of money at the beginning of the investment period. In contrast, a periodic investment involves making regular contributions over time. The question asks to identify the option that is not a one-time (lump-sum) investment.

Step 2: Detailed Explanation:
- National Savings Certificate (NSC): This is a government savings bond where an individual invests a lump sum amount at the time of purchase for a fixed tenure.
- Fixed Deposits (FD): An FD is an instrument where a lump sum is deposited with a bank for a fixed period at a predetermined interest rate. It is a classic example of a one-time investment.
- Recurring Deposits (RD): An RD requires the investor to deposit a fixed amount of money at regular intervals (usually monthly) for a specified period. This involves periodic payments rather than a single lump-sum investment.
- Kisan Vikas Patra (KVP): This is another government savings scheme where a lump sum is invested, and it doubles in a predetermined period.
Based on the descriptions, Recurring Deposit is the only option that involves systematic, periodic investments rather than a one-time deposit.

Step 3: Final Answer:
Recurring Deposits are not a one-time investment as they require regular, periodic contributions.