Calculate the Interest Rate for a Revolving Credit Facility in 2014

question 20

Multiple Choice

Calculate the interest rate for a revolving credit facility in 2014 given the following information.

Details:

Pricing spread: 350 bps

• A)7.85%
• B)4.35%
• C)0.85%
• D)3.5%

---

Definitions:

Probability Density Function

Probability density function is a function that describes the likelihood of a random variable to take on a given value, primarily used in continuous probability distributions.

Continuous Random Variable

A continuous random variable is a variable that can take an infinite number of values within a given range, representing quantities that can be measured, not just counted.

Probability Density Function

A function that describes the relative likelihood for a continuous random variable to occur at a given point in the observation space.

Continuous Random Variable

A type of random variable that can take an infinite number of values within a given range, often measured to any degree of precision.