QUESTION 13

1. Consider an MPT created from the following pool of loans:

   	Number of Loans	Principal	Rate	Maturity
   Group 1	75	$200,000	5%	30 years
   Group 2	120	$100,000	4%	15 years

   What is the WAC for the MPT at origination? Rounded to 4 decimals when WAC represented as fraction

   		0.0396
   		0.0413
   		0.0495
   		0.0510
   		0.0456

3 points

QUESTION 14

1. Consider an MPT created from the following pool of loans:

   	Number of Loans	Principal	Rate	Maturity
   Group 1	50	$200,000	5%	30 years
   Group 2	100	$100,000	4%	15 years

   Which of the following statements is FALSE?

   	A.	At issuance, WAM of this security is 22.5 years
   	B.	At issuance, WAC of this security is 4.5%
   	C.	As mortgages in this pool become more seasoned, WAC will go up
   	D.	As mortgages in this pool become more seasoned, WAM will go up
   	E.	At issuance, both groups have equal share in total pool balance

3 points

QUESTION 15

1. Under 175% PSA prepayment model, what is the SMM in month 25 of a mortgage passthrough? Expressed as a fraction, rounded to 6 decimals.

   	A.	0.007602
   	B.	0.000292
   	C.	0.087500
   	D.	0.005503
   	E.	0.010855