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Liability payments of 1 0 0 each are due to be paid in 2 , 4 and 6 years from now. Asset cashflow consists of
Liability payments of each are due to be paid in and years from now. Asset cashflow consists of in year and in years. The yield for all payments is An attempt is made to have the asset cash flow immunize the liability cashflow by matching present value and duration.
a Find and
b Determine whether or not the conditions for Redington immunization are satisfied.
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