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"Leon borrowed money to purchase a car against the certificate of deposit he has in the bank. Is this a secured transaction? Is the car his collateral? Explain your answer."

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Final answer:

Yes, this is a secured transaction. Leon provided the car as collateral against the money he borrowed using his certificate of deposit.

Step-by-step explanation:

Yes, this is a secured transaction. When Leon borrowed money to purchase a car against his certificate of deposit in the bank, he provided the car as collateral. Collateral is an asset that a borrower pledges to a lender to secure a loan, and it can be seized and sold by the lender if the loan is not repaid. In this case, the car serves as security for the loan, making it a secured transaction.

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