The Tranches in a Collateralized Mortgage Obligation (CMo) That Are

question 7

Multiple Choice

The tranches in a collateralized mortgage obligation (CMo) that are most likely to provide protection for investors against both extension and contraction risk are:

• A) planned amortization class (PaC) tranches.
• B) support tranches.
• C) sequential-pay tranches.

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Definitions:

Psychologists

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General Public

A term referring to the unorganized, broad group of people in society who do not belong to particular subgroups or professions; the average people.

Factor Analysis

A statistical method used to describe variability among observed, correlated variables in terms of potentially lower number of unobserved variables, called factors.

Subjective Bias

A distortion in judgment or perception resulting from personal opinions, emotions, or influences rather than objective facts.