7. Chapter 10 offers two approximations to pricing bonds in the secondary market (equations 8 and 9).

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7. Chapter 10 offers two approximations to pricing bonds in the secondary market

(equations 8 and 9). What is the difference between them? Why is equation (9)

of specific relevance to this chapter, which discusses the internal hedging of prepayment risk?

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Elements Of Structured Finance

ISBN: 9780195179989

1st Edition

Authors: Ann Rutledge, Sylvain Raynes

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