Question
A 30-year 1/1 ARM has an initial rate of 1.5%. In the future the rate will reset to 250 basis points above the LIBOR index
A 30-year 1/1 ARM has an initial rate of 1.5%. In the future the rate will reset to 250 basis points above the LIBOR index with no rate caps or floors. At the first reset, the LIBOR is 4%. What is the fully indexed rate at the first reset?
| 4%
| ||
| 5.5%
| ||
| 6.5%
| ||
| 8.5%
|
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Managerial Accounting Creating Value in a Dynamic Business Environment
Authors: Ronald Hilton, David Platt
10th edition
78025664, 978-0078025662
