What is Adjustment Index?
A modification made to a piece of numerical data, or a set of numerical data, by a product of some type of a mathematical formula. There are a number of different types of adjustment indices, ranging in scale and purpose from mortgage rate adjustment to handicapping a golfer’s score. Read more for examples and further explanation including related video clips and also comments
Example explains Adjustment Index
In consumer finance, an adjustment index is commonly used to adopt adjustable rate mortgages to changes in the economy by combining a number of market interest rates to form a benchmark.
An adjustment index is also used in life insurance policy mathematics to account for the increased risk of the insured living one more year.
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