The Characteristics of a Collateralized Mortgage Obligation (CMO) Securities Issue

question 7

Multiple Choice

The characteristics of a Collateralized Mortgage Obligation (CMO) securities issue include all of the following EXCEPT

• A)the tranches will have different coupon rates.
• B)the CMO securities are insured separately from the GNMA pass-through securities.
• C)the principal payments are made totally to the earliest remaining tranche.
• D)GNMA pass-through securities are used as collateral in a trust to support the CMOs.
• E)the CMO securities are split into different tranches or groupings.

---

Definitions:

Genotype

The genetic makeup of an organism, consisting of the alleles inherited from both parents, which determines inherited characteristics.

Sociobiology

A field of scientific study that examines social behavior from an evolutionary perspective, aiming to understand how biology and evolution influence social behavior in animals, including humans.

Other-oriented

An approach or mindset focused on the thoughts, feelings, and needs of others rather than oneself.

Racial Discrimination

Unfair treatment of individuals based on their race or ethnicity.