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NEW QUESTION: 1
________ usually occurs when a colder liquid contacts a warmer metal surface.
A. Stress cracking
B. Stress shock
C. Thermal shock
D. Thermal fatigue
Answer: C
NEW QUESTION: 2
Which of the following regarding the BGP Shared Tree Join route is TRUE?
A. The PE attached to C-RP sends a BGP Shared Tree Join update to the C-RP.
B. The PE with a receiver for C-multicast group sends a BGP Shared Tree Join update to the PE attached
to the C-RP.
C. The PE attached to C-RP sends a BGP Shared Tree Join update to the PE attached to the source.
D. The PE with a receiver for C-multicast group sends a BGP Shared Tree Join update to the RP in the
provider core network.
Answer: B
NEW QUESTION: 3
Christopher Robinson, chairman of the board of directors for a private endowment fund, believes that the endowment fund for which he is responsible has diverged too far from its stated objectives. Over several years the board has increased the size of the fund's equity position beyond the stated limits of the investment policy statement. In an effort to realign the fund's investments, Robinson has elected to choose a mortgage-backed security (MBS) for inclusion in the endowment's portfolio. After surveying the MBS market, Robinson has selected four MBS securities to present as potential investments at the next investment committee meeting. Details on the selected MBS securities are presented below:
At the investment committee meeting, a fellow board member raises his concerns over the potential MBS investments stating, "While we all agree that the fixed-income proportion of the endowment is much too small, I am not sure the suggested MBS securities will fulfill the cash flow requirements of the endowment.
What risks are we taking on by allocating a portion of the portfolio to these investments? We cannot afford to end up with a timing mismatch between the cash needs of the endowment and the cash provided from its investments. Also, we have given no consideration to commercial mortgage backed securities (CMBS).
Isn't our analysis incomplete if we fail to give proper discussion of potential CMBS investment opportunities?" Robinson responded to his fellow board member by addressing the board member's concerns as follows:
"Since the cash requirements of the endowment fund fluctuate directly with interest rates, the cash flows provided from the MBS will provide adequate protection against cash shortfalls arising from differences in the timing of cash needs and cash sources. In addition, we can further reduce uncertainty surrounding the timing of cash flows by purchasing planned amortization class CMOs, which are securities issued against pools of MBS. CMBS were not presented due to the unacceptable risk profile of the comparable CMBS trading in the marketplace." Of the four MBS securities under consideration, which MBS will add the most value relative to the risk associated with the security assuming the effective durations of the MBS securities is approximately the same?
A. MBS-X.
B. MBS-Y.
C. MBS-W.
Answer: A
Explanation:
Explanation/Reference:
Explanation:
MBS-X has the highest OAS relative to the cost of the option embedded in the MBS. Therefore, ir is the most attractive of the four alternatives. (Study Session 15, LOS 58.e)
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