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Your company has 6 0 bonds outstanding with an 8 % annual coupon. The bonds have two years to maturity and the yield to maturity

Your company has

60

bonds outstanding with an

8 %

annual coupon. The bonds have two years to maturity and the yield to maturity is

6 % .

You want to immunize your position by investing in zero

-

coupon bonds. What maturity zero

-

coupon bonds should you choose, and how much money should you invest?

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