Conglomerate Corporation has acquired Acme Corporation. To help finance the takeover, Conglomerate will liquidate the overfunded portion

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Conglomerate Corporation has acquired Acme Corporation. To help finance the takeover, Conglomerate will liquidate the overfunded portion of Acme’s pension fund. The face values and current and one-year future liquidation values of the assets that will be liquidated are given below.

Liquidation Values Asset Face Value t 0 t 1 year IBM stock $10,000 $9,900 $10,500 GE bonds 5,000 4,000 4,500 Treasury securities 15,000 13,000 14,000 Calculate the one-year liquidity index for these securities.

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Financial Institutions Management

ISBN: 9780078034800

8th Edition

Authors: Anthony Saunders, Marcia Cornett

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