In a Securitization, Time Tranching Provides Investors with the Ability

question 32

Multiple Choice

In a securitization, time tranching provides investors with the ability to choose between:

• A) extension and contraction risks.
• B) senior and subordinated bond classes.
• C) fully amortizing and partially amortizing loans.

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Definitions:

Materials Price Variance

The difference between the actual cost of materials used in production and the standard cost that was expected or budgeted.

Materials Quantity Variance

The difference between the actual amount of materials used in production and the standard amount expected, measured in terms of cost.

Labor Price Variance

The difference between the actual cost of direct labor and the standard or expected cost.

Labor Quantity Variance

The difference between the actual labor hours used and the standard hours planned, multiplied by the standard hourly labor rate.