问题如下：
In a sequential-pay CMO, the longer-term tranche investors will have the lowest:
选项：
A. extension risk.
B. average life.
C. contraction risk.
解释：
C is correct.
For a sequential-pay CMO, the longer tranche term will lead to a lower contraction risk because of the protection against this risk offered by the other tranches. The longer-term tranche investor is likely to have a higher average life and extension risk because it is the last tranche repaid in a sequential-pay tranche.
老师问下 这个cmo不是对prepayment的重新打包和分配吗 那有钱了先还最长期的 他不是面临很高的缩期风险吗 有点搞糊涂了 这道题不是很理解
