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In 200-250 words, answer question #6 on page 145. What is the difference between interest rate risk and default risk? How do combinations of terms

In 200-250 words, answer question #6 on page 145.

What is the difference between interest rate risk and default risk? How do combinations of terms in ARMs affect the allocation of risk between borrowers and lenders? Is this a suitable way to allocate risk?

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