What is the present value of a twelve million

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a) Do you expect any changes in mortgage-backed security pricing if the pass-through security was not fully amortised?

b) What is the present value of a twelve million pool of ten-year mortgages with an 8 per cent monthly mortgage coupon per annum if market rates are seven per cent?

Assume that the pass-through security is fully amortised. The total mortgage-backed security fee is assumed to be 500 basis points.

Reference no: EM132611561

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