$(50$ points$)$ For a bond with information defined in the table below. Please perform

the following calculations:

a$)$ Map out the cash flows as a function of years into the future in Excel, calculate

the discount factor $($using YTM$)$ for each of the cash flow $($Hint: we did similar

things in the Lecture $10$ sample excel file$)$

b$)$ Calculate the present value of each of the cash flows and the price of the bond

based on PV of the all of the cash flows

c$)$ Calculate the price of the bond using a different way: the PRICE function in

Excel and confirm you obtained the same price as in step $b$

Questions $3$

$(20$ points$)$ For the same bond in question $1,$ assuming the new yield of the bond one

year from today is $4\%.$ Perform the following calculations:

a$)$ Calculate the new price of the bond, using the Price function in Excel. $($Ignore

the fact one year later this bond is only a four year bond$)$

b$)$ Calculate the price return of the bond and the income of the bond $($using

original YTM$)$

c$)$ Calculate the $1$ year total return of the bond