QUESTION 10 A borrower agrees to a $200,000, 30-year fixed-rate mortgage with a 6% (or 0.5% per month) quoted interest rate. How much of the first payment goes to principle? b. $205 c. $220 d $308 e. $335 f. $350 g. $366 h. $199 b c d e f g h 1 points

QUESTION 11 The process of packaging and/or selling mortgages that are then used to back publicly traded debt securities is called a. collateralization. b. securitization. c. market capitalization. d. stock diversification. e. mortgage globalization. a b c d e 1 points

QUESTION 12 The risk that an FI may not have enough capital to offset a sudden decline in the value of its assets relative to its liabilities Insolvency risk Technology risk Liquidity risk Operational risk a b c d e 1 points

QUESTION 13 ( )is the risk that a sudden and unexpected increase in liability withdrawals or unexpected loan demand may require an FI to liquidate assets in a very short period of time and at low prices. a. Credit risk b. liquidity risk c. default risk d. technological risk e. market risk a b c d e 1 points

QUESTION 14 A Japanese investor can earn a 1 percent annual interest rate in Japan or about 4.1 percent per year in the United States. If the spot exchange rate is 101 yen to the dollar, at what one-year forward rate would an investor be indifferent between the U.S. and Japanese investments? a. 95.99 b. 96.99 c. 97.99 d 98.99 e. 99.99 f. 100.99 g. 101.99 h. 102.99 yens per dollar a b c d e f g h 1 points

QUESTION 15 A U.S. bank converted $1 million to Swiss francs to make a Swiss franc loan to a valued corporate customer when the exchange rate was 1.2 francs per dollar. The borrower agreed to repay the principal plus 5 percent interest in one year. The borrower repaid Swiss francs at loan maturity and when the loan was repaid the exchange rate was 1.3 francs per dollar. What was the bank's dollar rate of return? a. 26.00 % b. -2.69 % c. 7.14 % d. -3.08 % e. 5.00 % a b c d e 1 points

QUESTION 16 A homebuyer bought a house for $245,000. The buyer paid 20 percent down but decided to finance closing costs of 4 percent of the mortgage amount. If the borrower took out a 30-year fixed-rate mortgage at a 5 percent annual interest rate, The closing cost is a. $1,900 b. $9,009 c. $1,220 d $5,666 e. $987 f. $3,500 g. $7,840 how much interest will the borrower pay over the life of the mortgage? a. $190,000 b. $190,093 c. $190,220 d $195,666 e. $230,987 f. $350,009 g. $278,993 FIll in the formula/inputs= 3 points

QUESTION 17 A homeowner can obtain a $200,000, 30-year fixed-rate mortgage at a rate of 6.0 percent with zero points or at a rate of 5.5 percent with 2.25 points. If you will keep the mortgage for 30 years, what is the net present value of paying the points (to the nearest dollar)? a. $1,900 b. $9,009 c. $1,220 d $6,688 e. $987 f. $3,500 g. $7,840 h . 8360 (to the nearest dollar)? a b c d e f g h