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Marizza181 [45]
2 years ago
10

A bank advertises a 3/1 ARM at 4.65% with a 3/9 cap. . . What is the maximum interest rate that can be charged during the fifth

year?. . 3%. . 4.65%. . 9%. . 10.65%
Business
1 answer:
IRINA_888 [86]2 years ago
8 0
<span>"a 3/1 ARM" means starting at a fixed interest rate for the first 3 years and the interest rate will adjust every year after the first three years  up to the part where it mentions a "3/9 cap". This on the other hand tells us that the increase will be 3% each time there is an interest rate increase and the max increase is 9%. Hence the answer is 9%</span>
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