Consider the following fixed-rate level-payment mortgage pass-through security: Total principal outstanding = $5,000,000 Weighted average mortgage (Note) rate = 8.25% Weighted average remaining maturity = 30 years (360 months) Pass-through rate=7.5% What is the amount of prepayment in the sixth month?
Consider the following fixed-rate level-payment mortgage pass-through security: Total principal outstanding = $5,000,000 Weighted average mortgage (Note) rate = 8.25% Weighted average remaining maturity = 30 years (360 months) Pass-through rate=7.5% What is the amount of prepayment in the sixth month?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Consider the following fixed-rate level-payment mortgage pass-through security:
Total principal outstanding = $5,000,000
Weighted average mortgage (Note) rate = 8.25%
Weighted average remaining maturity = 30 years (360 months)
Pass-through rate=7.5%
What is the amount of prepayment in the sixth month?
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