Assume that the company has just received a large amount of cash from selling assets and wants to use this cash to repay $1 million in debt maturing in two years. In the meantime, the necessary cash can be invested into one of the following investments: (1) a fund with a quoted fixed rate of 4.0% compounded semi-annually; (2) a fund with a quoted fixed rate of 3.90% compounded monthly; (3) zero coupon bonds maturing in two years and currently trading at $92.46 per $100 face value. Which investment fund should be chosen: 1, 2 or 3? (Assume the investments have equivalent risk.) How much cash will be invested?

Assume that the company has just received a large amount of cash from selling assets and wants to use this cash to repay $1 million in debt maturing in two years. In the meantime, the necessary cash can be invested into one of the following investments: (1) a fund with a quoted fixed rate of 4.0% compounded semi-annually; (2) a fund with a quoted fixed rate of 3.90% compounded monthly; (3) zero coupon bonds maturing in two years and currently trading at $92.46 per $100 face value. Which investment fund should be chosen: 1, 2 or 3? (Assume the investments have equivalent risk.) How much cash will be invested?

Assume that the company has just received a large amount of cash from selling assets and wants to use this cash to repay $1 million in debt maturing in two years. In the meantime, the necessary cash can be invested into one of the following investments: (1) a fund with a quoted fixed rate of 4.0% compounded semi-annually; (2) a fund with a quoted fixed rate of 3.90% compounded monthly; (3) zero coupon bonds maturing in two years and currently trading at $92.46 per $100 face value. Which investment fund should be chosen: 1, 2 or 3? (Assume the investments have equivalent risk.) How much cash will be invested?