Using Spreadsheet

You are interested in purchasing two bonds. Bond A: 15-year $1,000,000 bond, redeemable at 102.5,

and paying semi-annual coupons at i (2) = 4%. It is bought to yield i (2) = 5%. Bond B: 15-year,

$1,000,000 bond, redeemable at 102.5 and paying semi-annual coupons at i (2) = 6.5%, bought to yield

i (2) = 5%. Set up a bond amortization/accumulation schedule for each bond. Graph the values in the

book value column for each bond (on the same graph).