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9) You aim to immunize a portfolio of $1mil in today's term, with a target duration of 10 years, using a zero-coupon bond with maturity
9) You aim to immunize a portfolio of $1mil in today's term, with a target duration of 10 years, using a zero-coupon bond with maturity of 4 years and a perpetuity, each currently yields 6%. How much of the zero-coupon bond and the perpetuity will you hold in your portfolio? A. $560,000 and $440,000 for zeros and perpetuity, respectively. B. $330,000 and $670,000 for zeros and perpetuity, respectively. C. $700,000 and $300,000 for zeros and perpetuity, respectively. D. $500,000 and $500,000 for zeros and perpetuity, respectively
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