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6. (MBS) ABC Bank originated a pool of containing 100 three-year fixed-rate mortgages with loan amount of S150,000 each. All mortgages in the pool carry

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6. (MBS) ABC Bank originated a pool of containing 100 three-year fixed-rate mortgages with loan amount of S150,000 each. All mortgages in the pool carry a rate of 6% with annual payments. The guarantee and servicing fee is 1%. ABC Bank would like to sell the pool to investors via Mortgage Pass Through (MPT) security. Suppose that 50,000 shares will be issued and there are no prepayment and no default for the borrowers. a. Find the cash flows to each share of the MPS for the 3 years. If market interest rate is 5.5%, what is the price for each share of MPT security

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