Bond $A$ is a $12-$year $7\%$ annual coupon bond. Bond $B$ is a $12-$year $9\%$ annual coupon bond. Bond $C$ is a $12-$year $11\%$ annual coupon bond. Each of these three bonds has a yield to

maturity $($YTM$)$ of $9\%.$ Assume the market rate of interest does not change over time.

Specify the bond that sells at premium, sells at discount, and sells at par.

What is value of each bond at this moment $(t=0)?$

What would be the price of each bond $1$ year from now?

Is the expected total return earned on Bond A the same as the expected total return earned on Bond C$?$ Explain.

If the capital gains yield $($CGY$)$ earned on Bond A greater than the CGY on Bond C$?$ Explain.

Is the interest yield $($IY$)$ on Bond $A$ in year $2$ greater than the IY on Bond $C$ in year $2?$ Explain.

Hint: The last $3$ questions can be answered with abstract thinking $($i$.$e$.$ without doing any calculation$).$ Alternatively, you can calculate the expected total return and its two components $($CGY and IY$)$

to conclude, which tends to be more straightforward.