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The following CMO structure has 10% backed collateral

Tranche  Par amount (millions)    Coupon rate (%)

              A                      400                            7.5

              B                      300                            6.5

              C                      200                           7.25

If the client wants the notional IO with a coupon rate of 7%   

Calculate the nominal amount.

Show calculations and formula please

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92316750

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