23) Which tranche in a CMO is most likely to provide an investor protection from both extension and contraction risk?

1. Support Tranche.
2. Sequential pay tranche.
3. Planned Amortization class (PAC) tranche.

41) Which of the following statement's about Modified Duration is false?

1. Modified Duration provides a linear estimate of the percentage price change for a bond given a change in its YTM.
2. Modified Duration cannot be larger than Macaulay Duration (assuming a positive YTM)
3. Modified Duration is the best duration measure for a complex bond, such as a bond with an embedded option.

42) Which of the following is not a property of bond duration?

1. Presence and nature of embedded options
2. Coupon Rate or payment per period
3. Time-to-maturity (as of the beginning of the period)
4. Yield-to-maturity per period
5. The Bond's convexity
6. Fraction of the period that has gone by