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fgiga [73]
3 years ago
11

"Which statements are TRUE about IO tranches? I When interest rates rise, the price of the tranche falls II When interest rates

rise, the price of the tranche rises III When interest rates fall, the price of the tranche falls IV When interest rates fall, the price of the tranche rises"
Business
1 answer:
horrorfan [7]3 years ago
5 0

The available options are:

A. I and III

B. I and IV

C. II and III

D. II and IV

Answer:

C. II and III

Explanation:

IO tranche which is an acronym for Interest Only tranche is defined as a form of tranche which earns interest only from a secured loan which is derived from Principal Only tranche.

However, Interest Only tranche is quite different from a typical bond, simply because when market interest rate increases the rate of prepayment decreases, which in turn makes the rate of maturity to be longer. Thereby when interest rates increase, prices increase, and vice versa.

Hence the true statements are:

II When interest rates rise, the price of the tranche rises

III When interest rates fall, the price of the tranche falls

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C. Negative; Positive

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4 years ago
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Answer:

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5 0
3 years ago
Which of the following explains why a researcher would use an interview instead of an online survey?
uranmaximum [27]

Hey there!

I believe the answer to your question would be B.) The interviewer can record both observations and responses.

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Hope it helps and have a great day!

8 0
3 years ago
The materials used by the Holly Company's Division A are currently purchased from an outside supplier. Division B is able to sup
oee [108]

Answer:

The range of transfer price is $42 to $53

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3 years ago
What jobs would require a point count sample on soil particles?
liraira [26]

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