5. Consider a 30-year fixed-rate mortgage for $100,000 at a nominal rate of 9%. An S&L issues...

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5. Consider a 30-year fixed-rate mortgage for $100,000 at a nominal rate of 9%. An S&L issues this mortgage on April 1 and retains the mortgage in its portfolio. However, by April 2, mortgage rates have increased to a 9.5% nominal rate. By how much has the value of the mortgage fallen?

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Financial Markets and Institutions

ISBN: 978-0321280299

5th edition

Authors: Frederic S. Mishkin, Stanley G. Eakins

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