Determine the face par value f1 for the one-year


A company has liabilities of size 1,050 at each of times t=1, t=2 and t=3. They choose to exactly match liabilities to assets by purchasing a one-year bond with face value F1 paying annual coupons at an annual coupon rate of 3.5%, purchasing a two-year bond with face value F2 coupons at an annual coupon rate of 4.5%, and purchasing a three-year bond with face vale F3 paying annual coupons at an annual coupon rate of 4.5%. Determine the face (par) value F1 for the one-year bond. (Note:You will need to find the face value of all three bonds in order to solve the problem. I am only asking you to enter the face value for the one-year bond). Round your answer to the nearest percent.

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Financial Management: Determine the face par value f1 for the one-year
Reference No:- TGS02727769

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