Business, 19.11.2019 01:31, supermansabeast

You work for a pension fund that has an obligation that must be paid in 10 years. currently this obligation, which has a present value of $200 million, is exactly funded (i. e., themarket value of the fund’s assets equals the present value of its obligation; net equity is exactlyzero). te duration of the fund’s assets is currently 8. the yield-to-maturity on zero coupon bondsof all maturities is currently 6%.(a)using the duration information, what would be the approximate change in the equity ofthe fund if interest rates decrease to 5% at all maturities? (b)your boss tells you that she would like you to shift all of the fund’s assets into a combinationof 5-year and 20-year zero-coupon bonds. how would you structure your investment to immunizethe fund against interest rate risk? that is, how much should you invest in the 5-year zero, and how much in the 20-year zero?

Answers: 1

Show answers

Other questions on the subject: Business

Business, 21.06.2019 17:20, keshonerice

Luis and rosa, citizens of costa rica, moved to the united states in year 1 where they both lived and worked. in year 3, they provided the total support for their four young children (all under the age of 10). two children lived with luis and rosa in the u. s., one child lived with his aunt in mexico, and one child lived with her grandmother in costa rica. none of the children earned any income. all of the children were citizens of costa rica. the child in mexico was a resident of mexico, and the child in costa rica was a resident of costa rica. how many total exemptions (personal exemptions plus exemptions for dependents) may luis and rosa claim on their year 3 joint income tax return? a. 6 b. 5 c. 4 d. 2

Answers: 3

continue

Business, 21.06.2019 20:50, clwalling04

Suppose someone wants to sell a piece of land for cash. the selling of a piece of land represents turning

Answers: 2

continue

Business, 22.06.2019 23:00, tonya3498

Which of the following is not one of the four principles of bottleneck management? a. increasing capacity at non-bottleneck stations is a mirageb. lost time at the bottleneck is lost system capacity. c. release work orders to the system at the bottleneck's capacity pace. d. increased bottleneck capacity is increased system capacity. e. bottlenecks should be moved to the end of the system process.

Answers: 1

continue

Business, 23.06.2019 02:10, musicfrk2207

Which of the following best describes what production accomplishes? a. efficient use of natural resources. b. a reduction in the size of the labor force. c. an increase in supply that lowers prices. d. value added to resources that already exist.

Answers: 1

continue

Do you know the correct answer?

You work for a pension fund that has an obligation that must be paid in 10 years. currently this obl...