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Business, 05.05.2020 05:01 mak92

A pension plan is obligated to make disbursements of $7 million, $2 million, and $2 million at the end of each of the next three years, respectively. The interest rate is 18% annually. If the plan wants to fully fund and immunize its position, how much of its portfolio should it allocate to one-year zero-coupon bonds and perpetuities, respectively, if these are the only two assets funding the plan

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A pension plan is obligated to make disbursements of $7 million, $2 million, and $2 million at the e...
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