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5. Firm XYZ is required to make a $5M payment in 1 year and a $4M payment in 3 years. The yield curve is flat

5. Firm XYZ is required to make a $5M payment in 1 year and a $4M payment in 3 years. The yield curve is flat at 10% APR with semiannual compounding. Firm XYZ wants to form a portfolio using 1- year and 4-year U.S. strips (zero-coupon bonds) to fund the payments. How much of each strip must the portfolio contain for it to still be able to fund the payments after a shift in the yield curve?

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