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You want to invest in a bond portfolio that you will use later to payoff a liability due in 7 years. Which of the following
You want to invest in a bond portfolio that you will use later to payoff a liability due in 7 years. Which of the following bond portfolios would immunize you from interest rate risk. A) Zero coupon bonds with 7 years to maturity
B) A portfolio of bonds with a duration of 7 years
C) A portfolio of bonds with an average 7 years to maturity
A and B
A and C
| A) Zero coupon bonds with 7 years to maturity |
| B) A portfolio of bonds with a duration of 7 years |
| C) A portfolio of bonds with an average 7 years to maturity |
| A and B |
| A and C |
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Public Finance and Public Policy
Authors: Jonathan Gruber
5th edition
1464143331, 978-1464143335
