A pension plan will have a cash outflow in 3 years they can


A pension plan will have a cash outflow in 3 years. They can invest in 2 year bonds with duration of 1.7 years and 4 year bonds with a duration of 3.5 years. To immunize the portfolio, the proportion invested in the 4 year bonds should be    (a) 0.44. (b) 0.28. (c) 0.5. (d) 0.72.

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Financial Management: A pension plan will have a cash outflow in 3 years they can
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