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Bond A Bond B Bond C 5% coupon bond, 3.75% coupon bond, 3.2% coupon bond, 1-year maturity 2-year maturity 3-year maturity Settlement date (when purchased)

Bond A Bond B Bond C
5% coupon bond, 3.75% coupon bond, 3.2% coupon bond,
1-year maturity 2-year maturity 3-year maturity
Settlement date (when purchased) 10/3/23 10/3/23 10/3/23
Maturity date 10/3/24 10/3/25 10/3/26
Annual coupon rate 0.05 0.0375 0.032
Yield to maturity 0.03 0.031 0.032
Face Value $ 1,000.00 $ 1,000.00 $ 1,000.00
Redemption (as % of Face Value) 100 100 100
Coupon payments per year 1 1 1
1. Describe all cash flows (in future values) these three bonds will pay in Year 1 to Year 3 in the table.
Bond A Bond B Bond C
Year 1 Cash Flow $ 1,050.00 $ 37.50 $ 32.00
Year 2 Cash Flow $ - $ 1,037.50 $ 32.00
Year 3 Cash Flow $ - $ - $
2. Compute the present value for all cash flows (individually) for the three bonds.
Bond A Bond B Bond C
PV of Year 1 Cash Flow
PV of Year 2 Cash Flow
PV of Year 3 Cash Flow

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