When the FHLMC Creates CMOs,they Often Use Different _________________ to Issue

question 84

Short Answer

When the FHLMC creates CMOs,they often use different _________________ to issue the securities,which are characterized by the differences in coupon rate,maturity and risk profile.

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Definitions:

Economic Rent

Represents the payment to an owner or factor of production in excess of the costs needed to bring that factor into production. In simpler terms, it's the extra income earned because of an owner's unique position or resource.

Marginal Land

Land that yields minimal agricultural output due to poor soil quality, steep slopes, or other environmental factors.

Location

Refers to the geographical situation of a place based on physical and human factors, influencing its connectivity and economic activities.

Marginal Land

Land that has limited agricultural productivity or is challenging to cultivate due to its poor soil, rough terrain, or other adverse conditions.