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FinanceQ&A LibraryThe Excel file Immunization Using Individual Bonds contains information about three bonds. Use this data to:Yield to maturity (Expected/Current)7% Number of Years to Future Liability8 Future Liability $ 3,000.00 Bond 1Bond 2Bond 3Coupon rate8.00%9.000%7.00%Maturity92415Face value1,0001,0001,000Explain which bond you prefer to use to attempt to immunize this obligation which is due in 8 years.Analyze each bond’s performance in attempting to achieve immunizationPlease show work in excel and functions/equations used.Question

Asked Dec 6, 2019

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The Excel file **Immunization Using Individual Bonds **contains information about three bonds. Use this data to:

Yield to maturity (Expected/Current) | 7% | ||

Number of Years to Future Liability | 8 | ||

Future Liability | $ 3,000.00 | ||

Bond 1 | Bond 2 | Bond 3 | |

Coupon rate | 8.00% | 9.000% | 7.00% |

Maturity | 9 | 24 | 15 |

Face value | 1,000 | 1,000 | 1,000 |

Explain which bond you prefer to use to attempt to immunize this obligation which is due in 8 years.

Analyze each bond’s performance in attempting to achieve immunization

Please show work in excel and functions/equations used.

Step 1

**Bond 1:**

Yield to maturity = 7%

Coupon Rate = 8%

Calculation of Bond duration using excel is as follows:

Step 2

Formula used in the above table is as follows:

Step 3

**Bond 2:**

Yield to maturity = 7%

Coupon Rate = 9%

Calculation of Bon...

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