Which of the following is false?

Given that every other factor is equal, ARMs will have the lower expected cost for an ARM with no caps as compared to an ARM with negative amortization.

A 5/1 HYBRID ARM loan is a 5-year fixed rate after which the interest rate would become adjustable, tied to an index, and would be reset each year thereafter.

The expected cost of borrowing depends on the frequency of payment adjustments.

If an ARM index increased 15%, the negative amortization on a loan with a 5% annual payment cap is calculated by totaling the difference between the payment as if no cap existed and the 5% capped payment.