Question: A three-class (Class A, B, and C) sequential pay CMO starts with an $80 million principal amount in each class. The mortgages in the pool

A three-class (Class A, B, and C) sequential pay CMO starts with an $80 million principal amount in each class. The mortgages in the pool have a 7, 8 and 9 percent interest rate respectively. The CMO classes receive monthly payments. During the first three months, $2 million in interest and principle is received each month from the mortgage holders. What principal amounts are outstanding for each class at the end of the third month?

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