A Mortgage Pool Is Divided into A,B,C,and Z-Tranches Based on the Textbook

question 5

Multiple Choice

A mortgage pool is divided into A,B,C,and Z-tranches based on the textbook example.Which tranche will have the longest life?

• A) A-tranche
• B) B-tranche
• C) C-tranche
• D) Z-tranche
• E) All tranches will have equal lives.

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Definitions:

Freemium Revenue Model

A business strategy where basic services are provided free of charge while more advanced features must be paid for.

Utility And Usage Revenue Model

A business model where customers pay based on their usage of a service or product, emphasizing the utility value derived from using the product.

Fees

Charges imposed by service providers on consumers for the services offered.

Cost Of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including materials and labor.