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My pension plan will pay me $ 1 5 , 5 0 0 once a year for a 1 0 - year period. The first
My pension plan will pay me $ once a year for a year period. The first payment will come in exactly five years. The pension fund wants to immunize its position.
Required:
a What is the duration of its obligation to me The current interest rate is per year.
b If the plan uses year and year zerocoupon bonds to construct the immunized position, how much money ought to be placed in each bond?
c What will be the face value of the holdings in each zero?
Complete this question by entering your answers in the tabs below.
Required A
Required B
Required C
What is the duration of its obligation to me The current interest rate is per year.
Note: Do not round intermediate calculations. Round your answer to decimal places.
Duration
years
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