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| rev | Admin | (Created page with "You manage a pension fund, which provides retired workers with lifetime annuities. The fund must pay out $1 million per year to cover these annuities. Assume for simplicity that these payments continue for 20 years and then cease. The interest rate is 4% (flat term structure). You plan to cover this obligation by investing in 5- and 20-year maturity Treasury zero coupon bonds. You decide to minimize the funds exposure to changes in interest rates. How much should you in...") | Dec 5'23 at 0:38 | +1,218 |