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Assume the discount rate is 10%. An FI originates a pool of real estate loans worth $2 million with maturities of 5 years and paying

Assume the discount rate is 10%. An FI originates a pool of real estate loans worth $2 million with maturities of 5 years and paying interest rates of 10% APR per year. Calculate theĀ yearly payments received by the FI from the mortgage pool at year end cover the five-year period. If the payments are separated into interest only (IO) and principal only (PO) payments, what will be their present values?

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