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There is a liability of $50,000 due in 4 years and it has two possible investments: a 1000 par 2 year zero coupon and a
There is a liability of $50,000 due in 4 years and it has two possible investments: a 1000 par 2 year zero coupon and a 1000 par 5 year zero coupon, both earning 5%. Construct a duration match for the liability.
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