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What maturity bond must it purchase

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Reference no: EM133056192

An insurance company must make payments to a customer of $1 million in one year and $400,000 in four years. The yield curve is flat at 10%. Use annual compounding. If the company wants to fully fund and immunize its obligation to this customer with a single issue of a zero-coupon bond, what maturity bond must it purchase?

Reference no: EM133056192

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