Creating Mortgage-Backed Pass-Through Securities

question 34

Multiple Choice

Creating mortgage-backed pass-through securities:

• A)can largely resolve the duration and illiquidity risk problems for a FI
• B)would not have any effect on the duration and illiquidity risk problems for a FI
• C)can worsen the duration and illiquidity risk problems for a FI
• D)None of the listed options are correct.

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Definitions:

Communication Distance

The extent of difference or disconnect between the communication preferences, styles, or practices among individuals or groups.

Unity-of-Command Principle

A principle in management stating that each employee should receive orders from only one superior to avoid confusion and conflict.

Too Many Bosses

A situation in which an employee is required to report to multiple supervisors, often leading to confusion and conflict.

Line of Authority

Refers to the formal hierarchy within an organization that dictates who has the power to make decisions and who reports to whom.