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Question 10 Given the following information: 60 million of mortgage pool principal assigned to floater class. 30 million assigned to the inverse floater class. Mortgage

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Question 10 Given the following information: 60 million of mortgage pool principal assigned to floater class. 30 million assigned to the inverse floater class. Mortgage Pool WAC = 6.5% Floater class coupon rule: LIBOR + 0.5% LIBOR in first month is 5% What is the max cap/coupon rate that can be paid to the floater class? Answer in percentage terms with two decimals. Note: you may not need all the information provided for your calculations. A. 8.75% . 9.75% C. 6.50% D. 5.50% E. 10.25% 6.500 60

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