Floating-Rate Debt Is Advantageous to Investors Because the Interest Rate

question 15

True/False

Floating-rate debt is advantageous to investors because the interest rate moves up if market rates rise.Since floating-rate debt shifts interest rate risk to companies, it offers no advantages to issuers.

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Definitions:

Uninhibited Actions

Behaviors performed without social restraint or consideration of their appropriateness, often spontaneous or impulsive in nature.

Self-Awareness

The conscious knowledge of one's own character, feelings, motives, and desires.

Posthypnotic Suggestion

A directive given to a person under hypnosis that is to be enacted after coming out of the hypnotic state, potentially influencing behavior unconsciously.

Hypnotic Analgesia

The reduction of pain through hypnosis, exploiting the mind's ability to alter perception of pain.