Accrued interest. You are the holder of a bond with a face value of $1,000, a coupon of 5%, a maturity date of coupon 5%, maturing in 4 years. The interest rate is currently 4%. The coupon is paid every February 1. You sell your bond on March 22. What is the full price you want to get for this bond? you want to receive for this bond?
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:
Accrued interest. You are the holder of a bond with a face value of $1,000, a coupon of 5%, a maturity date of
coupon 5%, maturing in 4 years. The interest rate is currently 4%. The coupon is
paid every February 1. You sell your bond on March 22. What is the full price you want to get for this bond?
you want to receive for this bond?
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