ssets with the same duration as your liability, so you need to find the duration of your Ft / (1+y) t Bond Price obligation. D = Ew; * t, where w = Using the financial calculator to find the bond price: FV = 1000; N = 2; PMT =80; 1/Y = 6; CPT PV = - 1,036.66785 PV(CF1) = 80/(1.06) = 75.47170w1 = 75.47170/1,036.66785= 0.07280 PV(CF2) = 1080/(1.06) = 961.19616w2 = 961.19616/1,036.66785= 0.92720 D=w1*1+w2*2 = 0.07280*1 +0.92720*2 D = 1.92720 years Your dollar value of liability = price per bond*number of bonds outstanding = 1,036.66785*60 = 62,200.07120 You need assets with the same present value as your liabilities and the same duration. DA = Wzero*Dzero+WPerpetuity*Dperpetuity; Dperpetuity = (1+y)/y and Dzero= time to maturity 1.92720=WZero *1 + (1-Wzero)*((1.06)/.06) WZero= 0.94437 and WPerpetuity=.05563 Total assets = 62,200.07120 so Amount in Zeroes = 62,200.07120*.94437 = $58,739.88 and uition - 6? 200.07120*.05563 = $3,460.19