A pension fund manager knows that the following liabilities must be satisfied: Liability (in millions) Years from
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A pension fund manager knows that the following liabilities must be satisfied: Liability (in millions) Years from Now 1 123 + 4 $2.0 3.0 5.4 5.8 Suppose that the pension fund manager wants to invest a sum of money that will satisfy this liability stream. Assuming that any amount that can be invested today can earn an annual interest rate of 7.6%, how much must be invested today to sat- isfy this liability stream?AppendixLO1
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