Question: How do I solve this? This question has 2 parts, part a and part b. 3. You manage a pension fund, and your liabilities consist

 How do I solve this?This question has 2 parts, part a

How do I solve this?

This question has 2 parts, part a and part b.

and part b. 3. You manage a pension fund, and your liabilities

3. You manage a pension fund, and your liabilities consist of three payments as follows: (Total 10 points) Time Payment 5 years 5 million 10 10 million years 30 30 million years The term structure is currently flat at 10%. a) Compute the present value of your liabilities. (5 points) PMT b) Compute modified duration of your liabilities. (5 points)

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