If One of the Terms of an ARM Read,interest Is

Multiple Choice

If one of the terms of an ARM read,interest is capped at 2%/5%,what would that mean?

A) The borrower can choose the cap he wants by simply circling the appropriate choice
B) The interest rate has a 2% annual cap rate and a 5% lifetime cap rate
C) The interest rate has a 5% annual cap rate and a 2% lifetime cap rate
D) The interest rate has a 2% annual cap rate and a 5% floor cap rate