The risk resulting from a decline in mortgage rates that will shorten the life of a mortgage is called:
A) Prepayment risk.
B) Contraction risk.
C) Extension risk.
D) Price risk.
E) None of the above.
Correct Answer:
Verified
Q11: The security issued by Freddie Mac is
Q12: Non-agency mortgage pass-through securities are supported by
Q13: Prepayment risk, which is associated with the
Q14: A collateralized mortgage obligation (CMO):
A) Cannot eliminate
Q15: A CMO is structured with various bond
Q17: Computing a yield for a mortgage-backed security
Q18: Commercial mortgage-backed securities:
A) Are issued by private
Q19: A stripped mortgage-backed security is a type
Q20: The cash flow of a mortgage pass-through
Q21: Mortgage loans that are greater than the
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents