Which of the following statements is most correct? (Points : 1) Variable rate de

Question

Which of the following statements is most correct? (Points : 1)

Variable rate debt never should be used by healthcare organizations because it is too risky.

Compared to fixed interest rates, variable rates are riskier for the borrower but less risky for the lender.

Compared to fixed interest rates, variable rates are riskier for the lender but less risky for the borrower.

Variable rates are equally risky for the lender and the borrower.

Fixed interest rates are more prevalent when long-term borrowing rates are high.

Explanation / Answer

Compared to fixed interest rates, variable rates are riskier for the borrower but less risky for the lender.

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