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Consider an 8% coupon selling for $953.10 with three years until maturity making annual coupon...

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Accounting

Consider an 8% coupon selling for $953.10 with three years until maturity making annual coupon payments. The interest rate in the next three years will be, with certainty r1 = 8% r2 = 10% r3 = 12%. Calculate realized compound yield of the bond.

I found the solution to be: FV = (80) (1.10) (1.12) + (80) (1.12) + 1080 = $1268.16, but I dont understand how they did it. Could someone explain it to me step by step, please? Thanks!

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