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Need help filling in the blanks (due at 5pm June 16) Excel Activity: Bond Valuation Clifford Clark is a recent retiree who is interested in
Need help filling in the blanks (due at 5pm June 16)
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 a 9% annual coupon, matures in 12 years, and has a $1,000 face value. - Bond C has an 8% annual coupon, matures in 12 years, and has a $1,000 face value. Each bond has a yield to maturity of 9%. Price (Bond A): $ Price (Bond B): $ Price (Bond C): \$ c. Calculate the current yield for each of the three bonds. (Hint: The expected current yield is calculated as the annual interest divided by the price of the bond.) Round your answers to two decimal places. Current yield (Bond A ): % Current yield (Bond B): % Current yield (Bond C): % d. If the yield to maturity for each bond remains at 9%, what will be the price of each bond 1 year from now? Round your answers to the nearest cent. Price (Bond A): $ Price (Bond B): \$ Price (Bond C): $ What is the expected capital gains yield for each bond? What is the expected total return for each bond? Round your answers to two decimal places. Calculate the price of each bond ( A,B, and C) at the end of each year until maturity, assuming interest rates remain constant. Round your answers to the nearest cent. What is the expected current yield for each bond in each year? Round your answers to two decimal placesStep by Step Solution
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