Which of the Below Statements Is TRUE

question 41

Multiple Choice

Which of the below statements is TRUE?

• A) There is very little variability of the average life for the tranches.
• B) The distribution of principal effectively protects a shorter-term tranche against extension risk; this protection comes from the other tranches.
• C) There is very little or no protection provided for each tranche against prepayment risk.
• D) None of these

---

Definitions:

NADPH

A coenzyme known as nicotinamide adenine dinucleotide phosphate plays a crucial role in anabolic reactions by serving as a reducing agent during biosynthetic processes.

ATP

Within cells, the molecule adenosine triphosphate is crucial for energy conveyance essential for metabolic functions.

C4 Pathway

A photosynthetic process in some plants that captures carbon dioxide in a four-carbon compound, allowing them to thrive in high temperatures and light intensities.

Photosynthesis Efficiency

The ability of plants to convert light energy from the sun into chemical energy stored in organic compounds with minimal energy loss.