Question

11 a way to avoid interest rates that vary with the market is to make sure have which type of loan?

fixed rate loan
frozen account loan
adjustable rate loan
automated loan

Explanation:

Analyze the question prompt

The question asks for a way to avoid interest rates that vary with the market. This means we are looking for a type of loan where the interest rate remains constant throughout the life of the loan.

Evaluate the options

Using the Loan Repayment Terms knowledge point

• Fixed rate loan: The interest rate is locked in and does not change, protecting the borrower from market fluctuations.
• Frozen account loan: This is not a standard financial term for avoiding market interest rate changes.
• Adjustable rate loan: The interest rate changes periodically based on market indices, which is the opposite of what is desired.
• Automated loan: This refers to the processing or approval method of a loan, not its interest rate structure.

Select the correct option

The loan type that keeps the interest rate constant and avoids market fluctuations is a fixed rate loan.

Answer:

• (A) Fixed rate loan (Correct answer)
• (B) Frozen account loan
• (C) Adjustable rate loan
• (D) Automated loan