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All of the Following Are True About Mortgage-Backed Securities EXCEPT

Question 79

Multiple Choice

All of the following are true about mortgage-backed securities EXCEPT


A) They represent claims on the cash flows generated by a pool of mortgages.
B) All of the cash flows from these securities are guaranteed by the U.S. government.
C) They can be purchased by individual investors, pension funds, and mutual funds.
D) The primary risk associated with them is that homeowners may not be able or may not choose to repay the loan.

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