For example, assume Amelia wants to earn a return of 7.00% and i coupon rate (distributed semiannually) with three years remaining to maturity. The following formula can be used to compute the bond's intrinsic offered the opportunity to purchase a $1,000 par value bond that pays a 12.25% value: A A (1+C)3 Intrinsic Value (1+C)4 (1+C)6 (1+C) (1+C) (1+C)2 (1+ C)5 Complete the following table by identifying the appropriate corresponding variables used in the equation Unknown Variable Name Variable Value A Bond's semiannual coupon payment Bond's par value $1,000 Semiannual required return C Based on this equation and the data, it is reasonable to expect that Amelia's potential bond investment is currently exhibiting an intrinsic value greater than $1,000. Now, consider the situation in which Amelia wants to earn a return of 15%, but the bond being considered for purchase offers a coupon rate of 12.25%. Again, assume that the bond pays semiannual interest payments and has three years to maturity. ... you round the bond's intrinsic value to its par value, so that the the nearest whole dollar, then its intrinsic value of (rounded the nearest whole dollar) is greater than bond is Given your computation and conclusions, which of the following statements is true? When the coupon rate is greater than Amelia's required return, the bond should trade at a premium. O A bond should trade at a par when the coupon rate is greater than Amelia's required return. O When the coupon rate is greater than Amelia's required return, the bond's intrinsic value will be less than its par value. O When the coupon rate is greater than Amelia's required return, the bond should trade at a discount