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Options
- A
Usually the prime lending rate
- B
The actual yield spread
- C
Only payable on maturity
-
Base rate + spread
Correct answer
Why this is the answer
A floating interest rate is typically based on a benchmark rate (e.g., base rate or LIBOR) plus a spreaD) For example, it could be the base rate + a fixed percentage spread, adjusting with changes in the benchmark rate.
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