A bond is being sold at $960.47. If you know that the maturity of this bond will happen in 15 years from now, it has semiannual coupon payments, a face value of $1,000, calculate the coupon value and coupon rate in case the YTM equals to (a) 6%, (b) 9%, and (c) 11%.
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:
A bond is being sold at $960.47. If you know that the maturity of this bond will happen in 15
years from now, it has semiannual coupon payments, a face value of $1,000, calculate the
coupon value and coupon rate in case the YTM equals to (a) 6%, (b) 9%, and (c) 11%.
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