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  3. the y corporation has an obligation of $1 million

The Y Corporation has an obligation of $1 million in five years. It wishes to...

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Finance

  1. The Y Corporation has an obligation of $1 million in five years. It wishes to investment in a portfolio of two bonds to fulfill the obligation. Bond1 has a coupon rate of 12% and matures in 5 years. Bond2 has a coupon rate of 6% and matures in 10 years. Both bonds have semiannual coupon paymentsand the same yield of 8% per year. Explain why this bond portfolio would work for the immunization and find the money allocation (in $) of each bond. You may use Excel or formula to do find the durations.

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