If a Bank Is Asked to Quote a Rate on a One-Year

question 54

True/False

If a bank is asked to quote a rate on a one-year loan one year from today and the current interest rate on a one year loan is 7% and a two year loan is 8 %, it should quote 9%.
One year loan one year from today: [(1.08)^2/(1.07)] - 1 = 0.09 = 9%

---

Definitions:

Scuba Diving

The activity of underwater diving where the diver uses a self-contained underwater breathing apparatus (SCUBA) to breathe underwater.

Trademark Infringement

The illicit application of a trademark or service mark with goods and/or services without authorization, in a way that may lead to confusion, deceit, or error regarding the origin of the goods and/or services.

Consumers Confused

Consumers confused refers to a state where buyers are unable to understand or differentiate products, often due to misleading information or complex terms.

Restaurant Name

The designated title given to a dining establishment, which can reflect its theme, location, the cuisine it serves, or the owner's name.