Unformatted text preview: HYEHEON UNIVERSITY
Department of Finance and Real Estate ELEM 400
Sample Questions Jfor Midterm Bram Directions: Below appears a random sample of ten questions from a previous midterm exam in REMJW.
These questions are representative of the questions to be asked of you in your midterm enain on 2 March
NB: While I believe the answers to these questions are all oorrect and that these problems have no typos, by undertaking to answer these questions you understand that any such error is your liability and I make no
guarantees in this regard. If you think you have found such an error after doing the problem tulioe, please be kind enough to email me so that, should there actually fit a typo in a question or an error in the ammpangring
answers, I can correct it and repost this sample exam. 1. Consider a single mortgage coupon paying 310,000 in three months. Today”s market price for this
coupon. B“, is $9, 800. Determine which of the following statehmnts is false: a the value of $1,000.00 today is 1. 204.00 dollars receivable in three months, is $10204. b. the value of a current dollar in terms of dollars receivable in three months, is 10,204 basis points
c. the value of a current dollar in terms of dollars receivable in three months is ninetyeight cents {.98}
d. the value in current dollars of $500.00 receivable in three months is $490.00 e. none of the above 2. Consider a residential property with a current market value of $240, 000.00. Purchase of the property
has been ﬁnanced by three lenders. The UPB currently owed the senior lender is $100,000, that owed
to the ﬁrst junior lender is $50. 000.00, and that owed to the second junior lender is $30,000.00. Owing
to the owners sustained failure to service the coupon payments on his three mortgages the ﬁrst junior
lender ﬁles a foreclosure suit. At the foreclosure sale of the property, a. if the actual price at sale is $250,000.00, the second junior lender will talee a loss on its loan of
5,nno.nn. b. if the actual price at sale is $250,000.00, then after paying off the senior lender the ﬁrst junior
lender nor.I has $10,000.00 equity in the property. b. if the actual price at sale is $210,000.00, the ﬁrst junior lender will take a $40,000. 000.00 loss on
his loan c. if the actual price at sale is $220, 000.00, the lien of the second junior lender is (actinguished
d. if the actual price at sale is $260, 000.00, all three mortgage loans are paid oﬁ' e. none of the above ...
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 Spring '16

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