Freddie Mac owns 3 mortgages, each of which will pay off $1 million in present value 60% of the time and $0 million 40% of the time. The payoffs of the three mortgages are independent. Freddie Mac issues a CMO where the owner of the senior tranche receives $1 million so long as at least one of the three mortgages does not default (that is, so long as at least one mortgage does pay back $1 million). What is the expected value of this CMO? Choose the nearest answer. A 400,000 B 936,000 C 600,000 D 216,000