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For the MBS investor, an increase in the prepayment speed of a pass-through MBS will result in a. an increase in the rate of return
For the MBS investor, an increase in the prepayment speed of a pass-through MBS will result in
a. an increase in the rate of return over the investor's original investment horizon
b. a reduction in interest earned over the life of the pass-through
c. an increase in principal earned over the life of the pass-through
d. no change in principal but an increase in interest earned over the life of the pass-through
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