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Suatus: QUESTION 1 You are given the following information with respect to a bond: Par value: 1000: Term to maturity: 3 years: (2) Annual coupon

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Suatus: QUESTION 1 You are given the following information with respect to a bond: Par value: 1000: Term to maturity: 3 years: (2) Annual coupon rate 4% payable annually. B) You are also given that the one, two, and three year annual spot interest rates are 5%, 8% and 11% respectively, Calculate the value of the bond. A 832,83 O B.902.63 OC.984.12 0.1003 24 O E 1152.87 QUESTION 2 An insurance company has a known ability of 6000 that is due 8 years from now. The technique of full immunization is to be employed. Asset will provide a cash flow of 1.000 exactly 7 years from now. Asset I will provide a cash flow of X exactly y years from now, where y3. The annual effective wterest rates Calculatex O A 4,36151 04.529.31 C5,001.14 CD501.42 CHS Smith and Chick Save An Artowe

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