Question: Your must pay 2 5 0 , 0 0 0 to 3 years from today. The duration of Bond 1 is 2 years and the

Your must pay 250,000 to 3 years from today. The
duration of Bond 1 is 2 years and the duration of
Bond 2 is 5 years. The yield to maturity of both
bonds is 8% per year. How much must you invest
in Bond A and Bond B to immunize yourself
against interest rate risk?

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