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Frank must pay liabilities of 1,000 due 6 months from now and another 1,000 due one year from now. There are two available investments: Bond

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Frank must pay liabilities of 1,000 due 6 months from now and another 1,000 due one year from now. There are two available investments: Bond I: A 6-month bond with face amount of 1,000, an 8% nominal annual coupon rate convertible semiannually, and a 6% nominal annual yield rate convertible semiannually; Bond II: A one-year bond with face amount of 1,000, a 5% nominal annual coupon rate convertible semiannually, and a 7% nominal annual yield rate convertible semiannually. Calculate the amount of each bond that Frank should purchase to exactly match the liabilities. Frank must pay liabilities of 1,000 due 6 months from now and another 1,000 due one year from now. There are two available investments: Bond I: A 6-month bond with face amount of 1,000, an 8% nominal annual coupon rate convertible semiannually, and a 6% nominal annual yield rate convertible semiannually; Bond II: A one-year bond with face amount of 1,000, a 5% nominal annual coupon rate convertible semiannually, and a 7% nominal annual yield rate convertible semiannually. Calculate the amount of each bond that Frank should purchase to exactly match the liabilities

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