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Q2. You are receiving a Convertible Mortgage to purchase an office building. The current interest rate on a standard FRM (similar mortgage without convertibility option)

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Q2. You are receiving a Convertible Mortgage to purchase an office building. The current interest rate on a standard FRM (similar mortgage without convertibility option) is 8%. Would the interest rate on the Convertible Mortgage be smaller or higher than 8%? Would the expected yield on the convertible mortgage be smaller or higher than 8%? Explain briefly. (1 point)

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