What is the total cost to the company today


Question:

Pension Fund project which will be offered in 5 years, company purchases zero coupon U.S. Treasury Trust Certificates which mature in 5 years, when originally issued they were 12% coupons, 30 year U.S.Treasury bonds, the stripped Treasuries are currently priced to yield 10%, total maturity value is $6000000. What is the total cost to the company today?

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Finance Basics: What is the total cost to the company today
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