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Question 21 ?

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  • Question 21 ?

    The immunization techniques works only for small changes in the interest rate. Therefore statement II should be false.

    Statment I is false, while statement III is true. The answer should be E, not D.

    What do you think..?
    Last edited by palaremzi; November 10 2005, 08:56 PM.

  • #2
    it is full immunization, which is an extension of immunization technique
    good luck.

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    • #3
      I agree, Broverman clearly states that immunization works only for small interest rate changes.

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      • #4
        Immunization is only good for small changes. However, Full immunization works for all changes of interest. Therefore, statement II is true.

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        • #5
          I don't know where Broverman mentions it but Kellison covers full immunization in Appendix VIII which is listed on the syllabus.

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          • #6
            Originally posted by palaremzi
            The immunization techniques works only for small changes in the interest rate. Therefore statement II should be false.

            Statment I is false, while statement III is true. The answer should be E, not D.

            What do you think..?
            Could you please remind me of the other two statements? I can't remember the exact wording. thanks

            Comment


            • #7
              grrrr... silly me. I downloaded the exam from the soa just now

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