1. What is the price of a $10,000 zero-coupon bond with 5 years to maturity at the yield to maturity of 6%? 2. What is the yield to maturity on a simple loan for $5,000 that requires a repayment of $8,000 in ten years? 3. What is the yield to maturity for a one-year bond with a face value of $10,000 currently selling for $9,600 with a current yield of 5%?
Debenture Valuation
A debenture is a private and long-term debt instrument issued by financial, non-financial institutions, governments, or corporations. A debenture is classified as a type of bond, where the instrument carries a fixed rate of interest, commonly known as the ‘coupon rate.’ Debentures are documented in an indenture, clearly specifying the type of debenture, the rate and method of interest computation, and maturity date.
Note Valuation
It is the process to determine the value or worth of an asset, liability, debt of the company. It can be determined by many processes or techniques. Many factors can impact the valuation of an asset, liability, or the company, like:
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
