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My pension plan will pay me $15,000 at the end of each year for the next 2 years. The current interest rate is 10% per
My pension plan will pay me $15,000 at the end of each year for the next 2 years. The current interest rate is 10% per year. The pension fund wants to fully immunize its position by purchasing zero-coupon bond.
what should be the maturity of the zero-coupon bond? how many zero-coupon bonds the pension fund should purchase if the par value for 1 bond is $1000?
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