Question: We are considering two different CMO structures, A and B A: 1 Billion of collateral is divided into a PAC bond with a par value
We are considering two different CMO structures, A and B
A: Billion of collateral is divided into a PAC bond with a par value of $ million and a support bond with a par value of $ million.
B: Billion of collateral is divided into a PAC bond with a par value of $ million and a support bond with a par value of $ million.
True or False The PAC bonds in the second investment B offer greater protection from prepayment risk than the PAC bonds in investment A
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