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You are managing a pension plan that is due to pay $ 1 1 million a year for 1 5 years with the first payment

You are managing a pension plan that is due to pay $11 million a year for 15 years with the first payment one year from today and $8 million a year for 10 years with the first payment 5 years from today. You can use a zero coupon bond with 4 years to maturity and a 20 year coupon bond with a duration of 12.31 years to immunize your portfolio. The interest rate is 7 percent for all maturities. How many zero coupon bonds will you have to purchase? Assume annual cash flows and compounding in your calculations.

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