chapter 7 bomd valuation

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 11% annual coupon, matures in 12 years, and has a $1,000 face value. Bond C has a 12% annual coupon, matures in 12 years, and has a $1,000 face value. Each bond has a yield to maturity of 11%. The data has been collected in the Microsoft Excel Online file below. Open 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" Dond Bond B 1. What is the expected current yield for each bond in each year? Round your answers to two decimal places. Years Remaining Until Maturity Bond A Bond B Bond C 12 % % % 11 % % % % % % 10 SI 8 % % % % % 7 % % % 6 % % % 5 % % % 4 % % % 3 96 % % 2 9 % % 1 % % % % % % 2. What is the expected capital gains yield for each bond in each year? Round your answers to two decimal places. Years Remaining Until Maturity Bond A 12 % Bond B Bond c % % 11 9 % % 10 % % 9% 9 % % % % % 96 % % % 9 -NWOO % % % 4 96 % % % % % % % % 96 % % 3. What is the total return for each bond in each year? Round your answers to two decimal places. Years Remaining Until Maturity Bond A Bond B Bond C 12 % % % 11 % % % 10 % % % 9 % % % 8 % % % % % % 6 % % % 5 % % % % % % + M N % % % % % % 1 % % %