The average shape of the yield curve over long periods of time suggests that
A) The average interest cost of an ARM will be lower than for an FRM
B) The average cost of an FRM will be lower than an ARM
C) The cost of an FRM and ARM will average out to be the same
D) Prepayments will be faster under an ARM
Correct Answer:
Verified
Q2: "Teaser" rates are often offered on
A) FRMs
B)
Q3: A conforming mortgage
A) Is the same as
Q4: By paying points, a home buyer
A) Is
Q5: Second mortgages
A) Have shorter maturities than first
Q6: With a fixed-payment amortized loan
A) The amount
Q7: The prepayment option in a home mortgage
A)
Q8: Which of the following features act to
Q9: Home equity lines of credit (HELOCs)
A) Are
Q10: Negative convexity
A) Relates to amortization schedules
B) Relates
Q11: Compared to home mortgages, commercial mortgages
A) Have
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