According to the question,
Pool's prepayment speed is PSA 185
So, pool's annual constant prepayment rate in month 41,
= (0.185)(41)(2)= 15.17
Note: Request you to please check your options once. The formula and concept is used to calculate annual prepayment rate is correct.
All the best for your exam! Thank you!
You think a mortgage pool's prepayment speed will be PSA 185. What will be the pool's...
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