A Collateralized Debt Obligation (CDO)

question 8

Multiple Choice

A collateralized debt obligation (CDO)

• A) is an insurance policy that any investor can purchase.
• B) is a bond that is secured by a portfolio of mortgages.
• C) protects an investor in the event that the issuer of the mortgage defaults on the contract.
• D) acts as a hedge against changes in interest rates.
• E) were outlawed with the passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

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Definitions:

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The mix of products and services that optimizes a buyer's satisfaction within their spending limit.

Cappuccino

A coffee drink made with espresso, hot milk, and steamed milk foam, often served with a sprinkle of cocoa powder or cinnamon on top.

Income

The total amount of money received by an individual or group from various sources, typically used for consumption, savings, and investing.

Cappuccino

A coffee drink made with espresso, hot milk, and steamed milk foam.