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For which of the following debt instruments, not having a fixed rate of interest over the life of the instrument, can ‘Floating Interest Rate’ be applied?
  • a)
    A loan
  • b)
    A bond
  • c)
    A mortgage
  • d)
    A credit
  • e)
    All of these
Correct answer is option 'E'. Can you explain this answer?
Most Upvoted Answer
For which of the following debt instruments, not having a fixed rate ...
A floating interest rate refers to any type of debt instrument, such as a loan, bond, mortgage, or credit.
An interest rate that is allowed to move up and down with the rest of the market or along with an index. This contrasts with a fixed interest rate, in which the interest rate of a debt obligation stays constant for the duration of the agreement.
A floating interest rate can also be referred to as a variable interest rate because it can vary over the duration of the debt obligation.
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For which of the following debt instruments, not having a fixed rate of interest over the life of the instrument, can ‘Floating Interest Rate’ be applied?a)A loanb)A bondc)A mortgaged)A credite)All of theseCorrect answer is option 'E'. Can you explain this answer?
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