Question: PART A. 1. Determine the cushion spread. 2. Compute the required terminal value and the required assets needed at initial implementation. 3. Determine whether active

PART A. 1. Determine the cushion spread. 2. Compute the required terminal value and the required assets needed at initial implementation. 3. Determine whether active management is still viable should interest rates immediately fall to 6.5%. PART B. 1. Using the available data, calculate and explain the pure sector allocation value added by the Capital goods sector allocation. 2. Using the available data, calculate and explain the within-sector allocation value added by the Consumer durables 3. Using the available data, calculate and explain by the allocation /selection interaction value added by the Energy sector. 4. Evaluate the validity of the benchmark that Same utilizes in assessing his performance.

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