Which of the following most accurately measures interest rate sensitivity for mortgage passthrough securities with prepayment risk?
Question:
Which of the following most accurately measures interest rate sensitivity for mortgage passthrough securities with prepayment risk?
a. Static duration
b. Effective duration
c. Modified duration
d. Macaulay duration.
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Step by Step Answer:
b Effective duration Effective duration is the measure that most accurate...View the full answer
Answered By
Aun Ali
I am an Associate Member of Cost and Management Accountants of Pakistan with vast experience in the field of accounting and finance, including more than 17 years of teaching experience at university level. I have been teaching at both undergraduate and post graduate levels. My area of specialization is cost and management accounting but I have taught various subjects related to accounting and finance.
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Related Book For 
Fundamentals Of Investments Valuation And Management
ISBN: 9781266824012
10th Edition
Authors: Bradford Jordan, Thomas Miller, Steve Dolvin
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