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vitfil [10]
2 years ago
9

You manage a pension fund that will provide retired workers with lifetime annuities. You determine that the payouts of the fund

are going to closely resemble level perpetuities of $1 million per year. The interest rate is 10%. You plan to fully fund the obligation using 5-year and 20-year maturity zero-coupon bonds. a. How much market value of each of the zeros will be necessary to fund the plan if you desire an immunized position? (Do not round intermediate calculations. Enter your answers in millions.) b. What must be the face value of each of the two zeros to fund the plan? (Do not round intermediate calculations. Enter your answers in millions rounded to 2 decimal places.)
Business
1 answer:
frosja888 [35]2 years ago
3 0
B . What must be the value
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One of the criticisms of average cost regulated pricing of a natural monopoly is that the firm Group of answer choices has no in
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The correct answer is a. has no incentive to hold costs down.

Explanation:

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1. Which of the following statements is false?
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3 years ago
Capital assets used by an enterprise fund should be accounted for in the a. Business-type activities journal but no depreciation
Diano4ka-milaya [45]

Answer:

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4 0
3 years ago
Compute the payback period for each of these two separate investments: A new operating system for an existing machine is expecte
labwork [276]

Answer:

Project A's payback period = 2.23 years

Project B's payback period = 3.3 years

Explanation:

                                                              project A                project B

initial investment                                 $290,000               $210,000

useful life                                               6 years                   11 years

yearly cash flow                     $83,653 + $46,500     $46,000 + $17,727

                                                         = $130,153                = $63,727

salvage value                                          $11,000                 $15,000

payback period                      $290,000 / $130,153  $210,000 / $63,727

                                                        = 2.23 years              = 3.3 years

8 0
3 years ago
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