Suppose that $1 billion of pass-throughs is used to create a CMO structure with a PAC bond

Question:

Suppose that $1 billion of pass-throughs is used to create a CMO structure with a PAC bond with a of $700 million (PAC I), a support bond with a schedule (PAC II) with a of $100 million, and a support bond without a schedule with a of $200 million.
Answer the below questions.
(a) Will the PAC I or PAC II have the smaller average life variability? Why?
(b) Will the support bond without a schedule or the PAC II have the greater average life variability? Why? Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...