Floating Rate Bonds

question 54

Multiple Choice

Floating rate bonds

• A) have interest payments based on some overall market rate.
• B) have a better capacity for constant market value.
• C) usually have very broad limits that interest payments cannot exceed.
• D) All of these options are correct.

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Definitions:

Financial Intermediaries

Institutions that act as middlemen in financial transactions, typically between savers and borrowers.

Commercial Banks

Financial institutions that offer a wide range of services to businesses and consumers, including deposit accounts, loans, and money transfers.

Minimum Balance

The smallest amount that must be maintained in a bank account to avoid penalties, such as service charges.

Check-Cashing Services

Financial services where checks can be cashed for a fee without needing a bank account.