You will be paying $10000 a year in tuition fees at the end of next two years. Bond currently yield 8%

1. What is the present value and duration of the fees
2. What maturity zero-coupon bond would immunize your fees?

Suppose you buy a zero-coupon bond with value and duration equal to your obligation. Now suppose that rates immediately increase to 9%. What happens to the difference between the value of the bond and that your tuition obligation

You will be paying $10000 a year in tuition fees at the end of next two years. Bond currently yield 8%

1. What is the present value and duration of the fees
2. What maturity zero-coupon bond would immunize your fees?

c)Suppose you buy a zero-coupon bond with value and duration equal to your obligation. Now suppose that rates immediately increase to 9%. What happens to the difference between the value of the bond and that your tuition obligation