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A. You own two bonds. Bond A is a 12% coupon bond with a yield of 8% which makes payments every quarter and matures in

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A. You own two bonds. Bond A is a 12% coupon bond with a yield of 8% which makes payments every quarter and matures in 10 years. The face value of the bond is $1000. Bond B is a 3% coupon bond with a yield of 8% that makes payments every month and has a maturity of 5 years. Calculate the value of each bond at every coupon payment date until maturity using excel. Graph your results together. (10 Marks) B. The company who originally sold you bond B have come on hard times. They have informed you that they will not be able to make the next 12 coupon payments but forecast that they will be able to make all payments after this date. This will increase the yield to 15% reflecting a higher level of risk. What is the new value of the bond? What is the percentage change in price? Use excel for all calculations

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