Answer :

Final answer:

Interest rates on variable products are determined using the Interest Rate Index, which tracks changes in interest rates over time for setting rates.


Explanation:

Interest rates on variable products are determined using the Interest Rate Index. This index tracks changes in interest rates over time and serves as a benchmark for setting the rates on variable products such as adjustable-rate mortgages or variable annuities.

The Interest Rate Index is a key factor in determining the profitability and attractiveness of variable products to investors. It provides a transparent and standardized way to adjust interest rates based on market conditions, ensuring fairness and accuracy in the pricing of these financial products.


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