Suppose you will go to med school for 4 years beginning in year 4. Tuition is...
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Suppose you will go to med school for 4 years beginning in year 4. Tuition is $30,521 per year, due at the end of each year you will be in school. If you want to immunize the interest rate risk associated with the future tuition payments by buying a single issue of a zero coupon bond. then what maturity zero coupon bond should you buy? Assume a flat yield curve of 0.07, and annual compounding. Round your answer to 2 decimal places. Suppose you will go to med school for 4 years beginning in year 4. Tuition is $30,521 per year, due at the end of each year you will be in school. If you want to immunize the interest rate risk associated with the future tuition payments by buying a single issue of a zero coupon bond. then what maturity zero coupon bond should you buy? Assume a flat yield curve of 0.07, and annual compounding. Round your answer to 2 decimal places.
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Maturity value of a zero coupon bond in year4 but purchased today shall be equal to present value of ... View the full answer
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