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a) Why is a special purpose vehicle used to own the loans and issue securities in a securitization transaction? b) How would an interest rate
a) Why is a special purpose vehicle used to own the loans and issue securities in a securitization transaction?
b) How would an interest rate derivative be used to address the interest cash flow mismatch in a securitization consisting of fixed loans in which floating securities are issued?
c) Is the correlation of the loans important in determining the level of credit enhancement? Why or why not?
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