My pension plan will pay me $15,500 once a year for a 10-year period. The first payment will come in exactly 5 years. The pension fund wants to immunize its position.

a.	What is the duration of its obligation to me? The current interest rate is 10.5% per year. (Do not round intermediate calculations. Round your answer to 4 decimal places.)

Duration

years

b.

If the plan uses 5-year and 20-year zero-coupon bonds to construct the immunized position, how much money ought to be placed in each bond? What will be the face value of the holdings in each zero? (Do not round intermediate calculations. Round your answers to the nearest whole dollar amount. Omit the "$" sign in your response.)

	Investment	Face Value
5-year zero-coupon bond	$	$
20-year zero-coupon bond	$	$