Most protection from prepayment risk

Assignment Help Financial Management

Reference no: EM13937907

1. Construct a 30-year CMO using this mortgage pool as collateral (Coupon paid quarterly). There are 3 tranches:

A: $50 million with 8% coupon (least protection from prepayment risk)

B: $100 million with 9% coupon

C: $50 million with 10% coupon (most protection from prepayment risk)

What are the promised coupon payments to each of the classes during the first quarter? What is the total interest payment due?

2. If the trustee received a payment of $4,834,796, how would the payment be applied?

3. Assume that for the first year the trustee receives quarterly payments each of $8 million. Show how each of these payments is distributed (Create a table showing each class for four quarters)

Reference no: EM13937907

Questions Cloud

Protect against any added liability risk is to obtain : When you get wealthier, usually the best way to protect against any added liability risk is to obtain:

Carbonyl compounds to the corresponding alcohol : Eugene Hur, a former undergraduate in our lab has discovered that AKR3A1, a protein from budding yeast, catalyzes the NADPH-dependent reduction of various carbonyl compounds to the corresponding alcohol. At saturating concentrations of the cosubst..

What is process that government goes through to make sure : What is the process that the government goes through to make sure that they adopt a balanced budget as prescribed by the Constitution? What roles do the governor, the Congress, and bureaucracy play in this process? (This is over Texas Govt)

Show how each transaction affects the accounting equation : Show how each transaction affects the accounting equation. Prepare the four basic financial statements for the month of April. (Balance Sheet at April 30, 2009)

Most protection from prepayment risk : What are the promised coupon payments to each of the classes during the first quarter? What is the total interest payment due? If the trustee received a payment of $4,834,796, how would the payment be applied? Assume that for the first year the trust..

Definition of the member functions to implement class : Write the definition of the member functions to implement the operations for this class. Also, write a program to test various operations on this class.

What are the total assets of the company at end of november : What are the total assets of the company at the end of November 2008? Prepare a statement of cash flows for November 2008. What was net income for November 2008?

Implement the data modelling for a database : Implement the data modelling for a database that is based on the following application scenario. The application scenario The online sale company Best Deal needs to implement a database to manage its business data. The company has delegated this t..

Benefits and challenges of integrating the operations : Apply a systems perspective to discuss why it is important to align the supply chain strategy with the design of the electronic business platform, and the benefits and challenges of integrating the operations of the two.

User Account

All Pages