Excel Activity: Bond Valuation

Clifford Clark is a recent retiree who is interested in investing some of his savings in corporate bonds. His financial planner has suggested the following bonds:

Bond A has a $10\%$ annual coupon, matures in $12$ years, and has a $$1,000$ face value.

Bond $B$ has an $8\%$ annual coupon, matures in $12$ years, and has a $$1,000$ face value.

Bond $C$ has a $9\%$ annual coupon, matures in $12$ years, and has a $$1,000$ face value.

Each bond has a yield to maturity of $9\%.$

The data has been collected in the Microsoft Excel file below. Download the spreadsheet and perform the required analysis to answer the questions below. Do not round

intermediate calculations. Use a minus sign to enter negative values, if any. If an answer is zero, enter $"0".$

Download spreadsheet Bond Valuation$-892$c$5$e$.$xlsx

a$.$ Before calculating the prices of the bonds, indicate whether each bond is trading at a premium, at a discount, or at par.

Bond $A$ is selling at

Bond $B$ is selling at

Bond $C$ is selling at

because its coupon rate is

because its coupon rate is

because its coupon rate is

the going interest rate.

$5$ the going interest rate.

J the going interest rate.

b$.$ Calculate the price of each of the three bonds. Round your answers to the nearest cent.

Price $($Bond A$)$: $

Price $($Bond B$)$: $