Private mortgage insurance is used to a. to ensure timely payments of escrow, taxes, and other fixed charges. b. reduce the default risk to lenders c. protect borrowers if they cannot make periodic payments

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
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Private mortgage insurance is used to
a.
to ensure timely payments of escrow, taxes, and other fixed charges.
b.
reduce the default risk to lenders
c.
protect borrowers if they cannot make periodic payments
d.
in lieu of a bond for termites
 
Covenants in loan agreements are used to
a.
make representations in agreements
b.
secure collateral
c.
control the borrower’s behaviour
d.
as guaranties
 
The Barbados branch of a foreign bank has a ROE that is three times greater than the TT branch. What may be the reason for this difference?
a.
The Barbados branch has lower equity
b.
The Barbados branch is more profitable than the TT branch
c.
The Barbados branch has proportionately higher profits to equity
d.
The TT branch has higher equity
 
Assume a single-payment $1,000 loan for one year at 16 percent. The APR is
a.
24 percent
b.
16 percent
c.
none of the above
d.
32 percent
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