A Three-Class CMO Has Class A,Class B,and Class C Securities

question 56

Multiple Choice

A three-class CMO has Class A,Class B,and Class C securities outstanding. Which class has the longest duration?

• A)Class A
• B)Class B
• C)Class C
• D)Class B and Class C have the same duration.
• E)All of these choices are correct.

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Definitions:

Rights

Legal, social, or ethical principles of freedom or entitlement.

Contract

A legally binding agreement between two or more parties that delineates the terms of their relationship and obligations to each other.

Vesting

The process by which an employee earns the right to receive full benefits from the employer's contribution to a pension plan or stock option plan over time.

Completed

The state of having finished all parts or aspects of a particular task or process successfully.