________ is an interest rate that changes periodically in accordance with a predetermined formula that indicates the spread (or margin) above some index at which the rate will reset periodically.

Question

Quizplus · Accepted Answer

A floating-rate CD has an interest rate that changes periodically based on a predetermined formula that takes into account an index and a spread or margin. This differs from a fixed-rate CD which has a set interest rate for the entire term of the CD. An Eurodollar CD is a type of time deposit that is denominated in U.S. dollars but held outside the U.S., and a domestic CD is simply a CD held within the U.S. and denominated in U.S. dollars, so neither of these options fit the definition given in the question.

________ Is an Interest Rate That Changes Periodically in Accordance