1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
FrozenT [24]
3 years ago
10

The following information is for a collateralized mortgage obligation (CMO). Tranche A of $50 million receives quarterly payment

s at 9 percent per year, tranche B of $100 million receives quarterly payments at 10 percent per year, and tranche C of $50 million receives quarterly payments at 11 percent per year.If at the end of the first quarter, the CMO trustee receives total cash flows of $8 million, how are they distributed among the three tranches? (0.2 points)5. What is the principal outstanding on Tranche A, Tranche B, and Tranche C after the end of year payment in the previous question? (0.2 points)
Business
1 answer:
Verdich [7]3 years ago
8 0
<h3>Answer:</h3><h3>Tranche A interest $50m*9%*3/12                          $1,125,000                                                </h3><h3>Tranche B interest $100m*10%*3/12                       $2,500,000                                                        </h3><h3>Tranche C interest $50m*11%*3/12                           $1,375,000</h3><h3>Principal balances:</h3><h3>Tranche  A        $47 million</h3><h3>Tranche B          $100 million</h3><h3>Tranche C           $50 million</h3><h3 /><h3 /><h3>Explanation:</h3><h3>The approach in debts securitization is that the most senior tranche,tranche A in  this question receives any payment  received in excess of periodic payment of interest.</h3><h3>On that basis,the quarterly payments can be shared between the three tranches as follows:</h3><h3>Total quarterly   payment    received                       $8000,000</h3><h3>Tranche A interest $50m*9%*3/12                            ($1,125,000)                                                </h3><h3>Tranche B interest $100m*10%*3/12                       ($2,500,000)                                                        </h3><h3>Tranche C interest $50m*11%*3/12                           ($1,375,000)                                        </h3><h3>Balance left                                                                  $3,000,000</h3><h3>As earlier reiterated, the balance of $3 million would be used to redeem part of tranche A,hence in tranche A is $47 million($50m-$3m):</h3><h3>Principal balances:</h3><h3>Tranche  A        $47 million</h3><h3>Tranche B          $100 million</h3><h3>Tranche C           $50 million</h3>

You might be interested in
Which of the following is true about a business plan?
dusya [7]

Answer:

d

Explanation:

the plan can change from buget sponsors and othere factors

3 0
3 years ago
Categories of rights <br>​
NeX [460]

Answer:

Human rights comprise of civil and political rights, such as the right to life, liberty and freedom of expression; and social, cultural and economic rights

3 0
2 years ago
Read 2 more answers
Aryanna invests $30,000 today into an investment that earns 5% annually, but interest is compounded continuously. What is the fu
yawa3891 [41]

Answer:

Future Value =$62,367.85

Explanation:

<em>The rate of return earned on the investment can be worked out using the Future value of a lump sum formula. The future value of a lump sum is the amount lump would amount to if interest is earned and compounded at a certain interest rate. </em>

The formula is FV = PV × (1+r)^(n)

PV = Present Value- 30,000

FV - Future Value, - ?

n- number of years- 15

r- interest rate - 5%

Future Value = 30,000× 1.05^15 =62,367.85

Future Value =$62,367.85

3 0
3 years ago
Terminating an employee for the use of illegal drugs is an example of a(n) _____ turnover. retentive external voluntary absentee
klasskru [66]

Answer:

involuntary

Explanation:

Involuntary turnover happens when an employee is dismissed from a position and asked to leave. In that respect, employees may be expelled for several reasons, usually for deficient performance and inadequate behavior. In contrast, voluntary turnover occurs when employees quit and the company wishes to keep them.

3 0
3 years ago
An increase in investment spending caused by higher expected rates of return will
alekssr [168]
<span>Spending more on investments in hopes of high returns will increase long term savings and decrease short term spending thus affecting the economy by affecting the law of supply and demand. The demand side of the equation would be affected as more money is put into or spent on savings.</span>
3 0
3 years ago
Other questions:
  • You just inherited some money, and a broker offers to sell you an annuity that pays $5,000 at the end of each year for 20 years.
    13·1 answer
  • Other administrative workers play key roles in the success of a human services organization. They are the ones who write _____ t
    5·2 answers
  • What does it mean to alter a landscape
    15·1 answer
  • An adjusting entry was made on year-end December 31 to accrue salary expense of $1,500. Assuming the company does not prepare re
    10·1 answer
  • If the commercial is TRUE that every additional bite of food tastes as good as the first, the marginal utility from consuming mo
    5·1 answer
  • What is your long term career goal?
    13·1 answer
  • Jodi hosts her own morning radio show. She works in the ______ pathway of the Arts, AV Technology, and Communication cluster.
    15·2 answers
  • When there is a climate of mistrust, employees Multiple Choice focus only on individual incentives. tend to create conflict. are
    5·1 answer
  • One of the most popular and effective ways to teach students are known as S.M.A.R.T goals. S.M.A.R.T is an acronym that stands f
    7·1 answer
  • 1. Briefly summarize the actions a firm can take to enhance the ethical behavior of its purchasing
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!