Question: A CMO is being issued with 2 tranches: - Tranche A has $28 million in principal and a 3.3% coupon. - Tranche B has $10

A CMO is being issued with 2 tranches: - Tranche A has $28 million in principal and a 3.3% coupon. - Tranche B has $10 million in principal and a 3% coupon. The mortgages backing the security issued are FRM at a mortgage rate of 5% with 10 year maturities and annual payments. There is no guarantee/servicer fee. Prepayment is assumed to be 5% CPR. What is the cash flow to Tranche A investors in year 1? Round your answer to two decimal points

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