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  3. a owes b s1100 at the end of one year and is requi

A owes B S1100 at the end of one year and is required to set...

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Finance

A owes B S1100 at the end of one year and is required to set up an investment fund in
order to meet this obligation. The only investments available are a money market fund
earnings 10% currently with the rate changing daily and two-year zero coupon bonds
also earning 10%. Develop an investment program based on immunization. Assume the
effective rate of interest is equal to 10% in all calculations.
(1) Draw a diagram to explain the topic (10%)
(2) Describe and list using the numbers of the topics.
(3) List and explain the calculation process (40% )

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