Which One of the Following Statements Is Correct About a Floating

question 7

Multiple Choice

Which one of the following statements is correct about a floating interest rate loan if the interest rate is defined as "Prime plus 1 percent"? The interest rate:

• A) is set to vary at a rate equal to the prime rate plus 1 percent.
• B) can fluctuate up to a maximum of 1% above the current prime rate over the life of the loan.
• C) will be fixed at the current prime rate plus 1 percent.
• D) will vary with the prime rate but changes will only occur in 1 percent intervals.

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Definitions:

Menopause

The period in a woman's life, typically between the ages of 45 and 55, when menstruation ceases, marking the end of reproductive capability.

Illness

A condition that disrupts a person's physical or mental well-being.

Disease

A condition that impairs normal physiological functioning, causing distress or discomfort to the organism affected.

Widows

Women who have lost their spouses by death and have not remarried.