Anita was not happy with the bank's interest rate policy. They offered a fixed…
2024
Anita was not happy with the bank's interest rate policy. They offered a fixed rate on all loans while she wanted a _________ rate.
- A.
moving
- B.
floating
- C.
free
- D.
market
Show answer & explanation
Correct answer: B
In banking terminology, loan interest rates are classified using a specific pair of terms: a "fixed" rate stays constant for the entire loan tenure, while its direct counterpart is a rate that changes periodically in line with a benchmark or base rate.
The sentence draws exactly this contrast: the bank offered a "fixed rate on all loans," while Anita wanted the opposite type of rate. The specific term for this opposite category is "floating."
Why the other options don't fit:
moving — not an established loan-rate term; no such category exists in banking terminology.
free — describes cost (no charge), unrelated to how a rate's structure is classified.
market — names broader economic conditions that influence a rate, not the specific one-word category label itself.
Ans: floating