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3. (MBS/ABS) a. Does high volatility in long term interest rates increase prepayment risk? Explain, why or why not. b. If the long term interest

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3. (MBS/ABS) a. Does high volatility in long term interest rates increase prepayment risk? Explain, why or why not. b. If the long term interest rates come down, would the value of an MBS security increase or decrease? Please explain. (15 points)

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