Given a pool with the following characteristics:

1. 10 IO loan, each loan $20M, 5% interest rate, 2 year maturity, each has initial LTV 80%

2. 5 IO loan, each loan $50M, 7% interest rate, 2 year maturity, each has initial LTV 90%

3. A 30% pari passu piece of a loan on a property worth $200M, IO loan, 8% interest rate, 2 year maturity, initial LTV 85%

4. 15% credit support

5. A senior class with a 6% coupon, a junior class with a 7.5% coupon, and a residual IO class will be created.

6. In year 1 two of the IO loan default. One default is on of the $20M loan, the property is instantaneously sold in foreclosure for $15M, and the default is for a property with $50M loan, this property is instantaneously sold in foreclosure for $35M

7. In year 2 three of the remaining 7% interest rate IO loans default, there is an instantaneous recovery rate of 50% of each loan

Answer the following question:

1. What is the starting pool balance?

2. What is the implied LTV for senior class and junior class?

3. if we increase the amount of credit support in this deal, would implied LTV for the senior class increase, decrease, or remain the same?

4. What's the scheduled cash flow to the senior class in year 1?

5. what's the realized cash flow to the junior class in year 1?