Problem 13-10 A university endowment fund has sought your advice on its fixed-income portfolio strategy. The characteristics of the portfolio's current holdings are listed below: Bond Credit Rating Maturity Coupon Modified Market Value (yrs.) Rate (%) Duration Convexity of Position A U.S. Govt. 3 0 2.712 9.7 $33,000 B A1 10 9 6.404 56.3 33,000 C Aa2 5 12 3.654 18.6 33,000 D Agency 7 11 4.868 32.1 33,000 E Aa3 12 0 11.269 128.9 33,000 $165,000 a. Calculate the modified duration for this portfolio (i.e., Mod Dp). Do not round intermediate calculations. Round your answer to three decimal places. years b. Suppose you learn that the implied sensitivity (i.e., modified duration) of the endowment's liabilities is about 6.30 years. Identify whether the bond portfolio is: (1) immunized against interest rate risk, (2) exposed to net price risk, or (3) exposed to net reinvestment risk. The portfolio's duration is -Select- the liability's duration, portfolio is -Select- less than immunized against interest rate risk more than equal to exposed to net price risk exposed to net reinvestment risk