"By creating a CMO, an issuer eliminates the prepayment risk associated with the underlying mortgages." Do you agree with this statement?
What will be an ideal response?
A CMO redirects cash flows making it possible to redistribute prepayment risk so that some investors reduce their prepayment risk exposure while others increase their prepayment risk exposure. Thus, one would agree with the statement that a CMO eliminates prepayment risk for certain investors, but would disagree with the statement that a CMO eliminates prepayment risk for all investors.
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Explain how fraud is different from other types of ethics violations and detail the three factors that are present every time a fraud is committed. Additionally, explain the special role of management in a fraud situation even if the managers themselves are not consciously participating in the fraud.
What will be an ideal response?
________ tax is an indirect tax levied on added value to the product.
Fill in the blank(s) with the appropriate word(s).
Which of the following acts controls point sources?
A)?Clean Air Act B)?Toxic Substances Control Act C)?Clean Water Act D)?All of the above
When people are finally ready to "close the deal" on their home purchase:
A) it will likely take place at least three to six weeks after they agree on price. B) one spouse can represent both if a "Power of Attorney" is signed. C) their real estate agent can represent them if a "Power of Attorney" is supplied. D) the money will finally change hands. E) All of the answers are correct