(I)ARMs Offer Lower Initial Rates and the Rate May Fall

question 74

Multiple Choice

(I) ARMs offer lower initial rates and the rate may fall during the life of the loan.
(II) Conventional mortgages do not allow a borrower to take advantage of falling interest rates.

• A) (I) is true, (II) is false.
• B) (I) is false, (II) is true.
• C) Both are true.
• D) Both are false.

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Definitions:

Situational Ethics

The ethical theory that morality is determined by the specific context of an act rather than by general or absolute rules.

Ethical Dilemma

A situation where an individual faces a choice between two morally right or conflicting principles where choosing one means compromising the other.

Ethical Absolutism

The belief in universal ethical standards that apply to all cultures and individuals regardless of context or situation.

Situational Ethics

A philosophy that ethical decisions should be made based on the context of a particular situation rather than by following absolute moral rules.