One Way to Completely Protect the Lender Against Interest Rate

question 103

True/False

One way to completely protect the lender against interest rate risk on a loan commitment is for the lender to price the loan at a variable rate against some index.

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Definitions:

Conspiracy Doctrine

A legal theory used historically to treat labour unions as illegal conspiracies, limiting their ability to strike or organize until legal reforms provided more protection.

Antitrust Laws

Legislation intended to promote competition and prevent monopolies by regulating the conduct and organization of business corporations.

Employment-At-Will Doctrine

A legal principle that allows an employer to terminate an employee at any time for any reason, except an illegal one, and without warning, as long as the reason is not illegal.

Common Law

A legal system based on customs, judicial decisions, and precedent rather than written laws; prevalent in the UK and former British colonies.