The changing cost of money when borrowing is referred to as ____________ risk.
A)Interest Rate
B)Inflation
C)Income
D)Liquidity
E)Personal

Question

Quizplus · Accepted Answer

Interest rate risk refers to the possibility of a decline in the value of an investment or asset due to a change in the interest rate. This risk can affect borrowers who have loans with variable interest rates because their payments will increase as the interest rate rises. It can also affect investors who hold fixed-income securities because the fixed interest payments they receive become less valuable when interest rates rise.

The Changing Cost of Money When Borrowing Is Referred to as ____________