Assume liabilities of $250, $500, and $550 must be met in periods 1, 2, and 3, respec- tively. Find a portfolio of the bonds shown below that meets these cash outflows. What is the cost of the portfolio?
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Cash Flows in Period
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Bond
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Price
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1
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2
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3
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A
|
950
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50
|
1,050
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|
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B
|
1,000
|
100
|
100
|
1,100
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C
|
920
|
1,000
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