An Interest Rate That Adjusts to Current Market Conditions Is

question 26

Multiple Choice

An interest rate that adjusts to current market conditions is called a(n) :

• A)floating rate.
• B)fixed rate.
• C)notional rate.
• D)arbitrage rate.
• E)preferential rate

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Definitions:

Marginal Cost

The financial outlay for making one more unit of a product or service.

Pollution Abatement

Measures and activities undertaken to reduce, control, or eliminate pollution from various sources in order to protect the environment.

Marginal Utility

The further gratification or value experienced by an individual upon consuming an extra unit of a particular good or service.

Supply-Side Market Failures

Situations where the supply side of a market does not allocate resources efficiently, often due to externalities or public goods problems.