One Hundred Identical Mortgages Are Pooled Together into a Pass-Through

question 92

Multiple Choice

One hundred identical mortgages are pooled together into a pass-through security.Each mortgage has a $150,000 principal,a fixed annual interest rate of 8 percent (paid monthly) ,and is fully amortized over a term of 30 years.

What is the present value of the mortgage pass-through if,immediately after origination,interest rates increase to 8.25 percent per annum?

• A)$15,000,000.
• B)$14,650,591.
• C)$14,000,000.
• D)$15,115,493.

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Definitions:

Absorption

The process by which substances are taken up into or across tissues, such as the absorption of nutrients by the digestive system or chemicals through the skin.

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Penicillins

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Pharmacotherapeutics

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