Lifeco Insurance Company needs to have $100 million 5 years from today to satisfy life insurance claims. Lifeco purchases 8 percent coupon bonds selling at par with a maturity of 6.2 years. Assume immediately after the purchase, an interest rate shock causes bond yields to jump up to 10%.

1. Immediately after the price shock, suppose Lifeco Insurance Company can purchase bonds selling at par that offer a 10 percent coupon. What will the maturity of these bonds be? (Round to 2 decimal places)

2. Six months go by and Lifeco Insurance Company wants to re-balance its portfolio. Lifeco has available bonds it can purchase that have a coupon of 8 percent and yield 9.75 percent. What will the maturity of these new bonds be? (Round to 2 decimal places) Suggestion: This can most efficiently be solved using an Excel spreadsheet.