After origination of a mortgage-backed security, the WAM changes. What measures are used by Fannie Mae and Freddie Mac to describe the remaining term to maturity of the loans remaining in the loan pool?
What will be an ideal response?
After origination of the MBS, the WAM of a pool changes. Fannie Mae and Freddie Mac report the remaining number of months to maturity for a loan pool, which they refer to as weighted average remaining maturity (WARM). Both Fannie Mae and Freddie Mac also report the weighted average of the number of months since the origination of the security for the loans in the pool. This measure is called the weighted average loan age (WALA).
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Meson Productions is a price-taker
Meson produces large spools of electrical wire in a highly competitive market; thus, the company uses target pricing. The current market price of the electric wire is $770 per unit. The company has $3,100,000 in average assets, and the desired profit is a return of 4% on assets. Assume all products produced are sold. The company provides the following information: Sales volume 110,000 units per year Variable costs $680 per unit Fixed costs $14,000,000 per year If variable costs cannot be reduced, how much reduction in fixed costs will be needed to achieve the profit target? A) $4,224,000 B) $14,000,000 C) $4,100,000 D) $14,124,000
Shifting production activities to lower-wage locations is a sustainable solution to competitive challenges
Indicate whether the statement is true or false